3-A company is considering Projects S and L, whose cash flows are shown below. These projects are mutually exclusive, equally risky, and not repeatable. If the decision is made by choosing the project with the higher IRR rather than the one with the higher NPV, how much value will be forgone?

Project B Cash Flow -$300

RRR:

CFS CFL

9.00% 01234 -$1,100 $375 $375 $375 $375 -$2,200 $725 $725 $725 $725