You are considering two independent projects, projects A and project B. The initial cash Flow outlay associated with project A is $50,000, and the initial cash outlay associated with project B is $70,000. The required rate of return on both projects is 12 percent. The expected annual free cash inflows from each project are as follows:

	Project A	Project B
Initial outlay	-$50,000	-$70,000
Inflow year 1	12,000	15,000
Inflow year 2	12,000	16,000
Inflow year 3	12,000	13,000
Inflow year 4	12,000	17,000
Inflow year 5	12,000	14,000
Inflow year 6	12,000	13,000

1. Calculate the PI, NPV,IRR and MIRR for each project

(20 Marks)

1. Based on your findings from (a) , should both projects be accepted if they are independent? Which project should be accepted if they are mutually exclusive?

(10 Marks)

1. Discuss NPV and IRR in terms of similarities and conflicts and the strengths of each approach.