You've estimated the following cash flows (in $) for two mutually exclusive projects:

Year	Project A	Project B
0	-5,500	-8,250
1	1,325	1,325
2	2,148	2,148
3	4,060	7,811

The required return for both projects is 8%.

Attempt 1/5 for 10 pts.

Part 1

What is the IRR for project A?

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Attempt 1/5 for 10 pts.

Part 2

What is the IRR for project B?

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Attempt 1/5 for 10 pts.

Part 3

Which project seems better according to the IRR method?

Project A

Project B

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Attempt 1/5 for 10 pts.

Part 4

What is the NPV for project A?

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Part 5

What is the NPV for project B?

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Attempt 1/5 for 10 pts.

Part 6

Which project seems better according to the NPV method?

Project B

Project A

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Attempt 1/5 for 10 pts.

Part 7

Compare the answers to parts 3 and 6. If both projects are mutually exclusive, which one should you accept?

Project A

Project B

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Answer rating: 100% (QA)

The detailed answer for the above question is provided below To calculate the internal rate of retur... View the full answer