Your division is considering two investment projects, each of which requires an up-front expenditure of $15 million.

Question:

Your division is considering two investment projects, each of which requires an up-front expenditure of $15 million. You estimate that the investments will produce the following net cash flows:

(a)
What are the two projects' net present values, assuming the cost of capital is 5%? 10% and 15%
(b)
What are the two projects' IRRs at the same costs of capital?

Net Present Value
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