8. A company is considering two mutually exclusive projects I and II. Following details are available to you: (` in lakhs)

Particulars Project I (`) Project II (`)

Initial Investment Estimated Life EBIT(`):

Year 1 Year 2 Year 3 Year 4 Year 5 4,00,000 4 Years 1,20,000 1,40,000 1,60,000 2,20,000 Nil 5,00,000 5 Years 1,40,000 1,60,000 1,80,000 2,20,000 2,00,000 If the corporate tax rate is 40% and cut off rate is 10%. Calculate IRR of the projects and advise the management on the project to be selected.