2. A company has to select one of the two alternative projects whose particulars are given below:

Project Initial Outlay Net Cash Flow 1 2 3 4 I 11,872 10,000 2,000 1,000 1,000 II 10,067 1,000 1,000 2,000 10,000 The company can arrange fund at 8%. Compute the NPV and IRR of the project. The present value of `1 at different cost of capital is given below:

Year 8% 10% 12% 14%

1 0.926 0.909 0.893 0.877 2 0.857 0.826 0.797 0.770 3 0.794 0.751 0.712 0.675 4 0.735 0.683 0.536 0.592