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19. (Size effect) Montebano, Inc. plans to choose between two mutually exclusive projects. The first one, A, is larger project costing $2,500,000 initially and generates

19. (Size effect) Montebano, Inc. plans to choose between two mutually exclusive projects. The first one, A, is larger project costing $2,500,000 initially and generates $270,000 each year. Project A is expected to last 10 years. A smaller project, B, has an initial cost of $300,000 and is expected to produce free cash flows of $50,000 per year over 10 years. Montebano has a weighted average cost of capital of 12%. A. Calculate the NPV, and IRR

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