24. The cash flows of two mutually exclusive projects are as under:

Year 0 1 2 3 4 5 6 Project P(`) (40,000) 13,000 8,000 14,000 12,000 11,000 15,000 Project Q (`) (20,000) 7,000 1,300 12,000 — — —

Required:

(i) Estimate the NPV using 15% as the cost of capital.

(ii) Estimate the IRR.

(iii) Why there is a conflict in the project choice using NPV and IRR?

(iv) Which criteria will you use in such a situation? Make the final choice.