1.

A project has cash flows of -$128,000, $52,800, $60,200, and $183,100 for years 0 to 3, respectively. The required payback period is two years. Based on the payback period of _____ for this project, you should _____ the project.

2. Mahjong, Inc., has identified the following two mutually exclusive projects:

Year	Cash Flow (A)	Cash Flow (B)
0	$36,100	$36,100
1	18,800	6,200
2	14,300	12,700
3	11,800	19,200
4	8,800	23,200

Required:

(a)	What is the IRR for Project A?

(b)	What is the IRR for Project B?

(c)	If the required return is 9 percent, what is the NPV for Project A?

(d)	If the required return is 9 percent, what is the NPV for Project B?

(e)	At what discount rate would the company be indifferent between these two projects?