Question: You are choosing between two projects. The cash flows for the projects are given in the following table ($ million): Year 1 year 2 year

You are choosing between two projects. The cash flows for the projects are given in the following table ($ million):

Year 1 year 2 year 3 year 4 year 5
-50 26 18 18 13
-101 19 41 49 60

a. What are the IRRs of the two projects?

b. If your discount rate is 4.7%, what are the NPVs of the two projects?

c. Why do IRR and NPV rank the two projects differently?

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