1) Which project will you choose and tell me the detailed reason.

Project	A	B	Higher value
NPV	$ 1,066,501.25	$ 898,071.78	A
IRR	23.30%	26.24%	B	* cost of capital: 13%
PI	1.32	1.42	B

2) Tell me the exact NPV profiles crossover rate (incremental IRR). what is the relevance of this rate?

Cash Flows	A	B	B - A
0	$ (3,285,000.00)	$ (2,150,000.00)	$ 1,135,000.00
1	$ 959,027.00	$ 676,218.00	$ (282,809.00)
2	$ 1,049,357.00	$ 743,706.00	$ (305,651.00)
3	$ 1,032,109.10	$ 739,939.92	$ (292,169.18)
4	$ 1,028,266.76	$ 745,599.20	$ (282,667.57)
5	$ 1,034,326.16	$ 758,372.84	$ (275,953.31)
6	$ 1,610,712.17	$ 1,010,783.52	$ (599,928.65)
		Incremental IRR	17.71%