Question: Please use Excel Consider the following two mutually exclusive projects. Project A Project B Now (n=0) -$1,000 $5,000 At the yearend (n=1) $2,000 $7,000 IRR

Please use Excel

Consider the following two mutually exclusive projects. Project A Project B Now (n=0) -$1,000 $5,000 At the yearend (n=1) $2,000 $7,000 IRR NPW(r=10%) ? ? a. Calculate the IRRs and NPWs (at r=10%) of the above projects A and B? b. Which project will you choose based on IRRs? Which project will you choose based on NPWs? c. Why is there a problem? At what rate will (unused) $4000 grow if we choose project A? d. Do incremental analysis and choose a better of two projects

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