Question: Styles Q.8. Ali ple has two possible projects to consider. It cannot do both - they are mutually exclusive. The cash flows are: Points in

Styles Q.8. Ali ple has two possible projects to consider. It cannot do both - they are mutually exclusive. The cash flows are: Points in time (yearly intervals) Project A Project B 0 -400000 -90000 1 135000 55500 2 145000 55500 3 155500 0 165000 0 Ali's cost of capital is 11 per cent. Assume unlimited funds. These are the only cash flows associated with the projects. (a) Calculate the internal rate of return (IRR) for each project. (3 marks) (The range of rates for Project A is 17% to 18%) (The range of rates for Project B is 15% to 16%) (b) Calculate NPV for each project (2 marks) 4

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