6. Nathaniel Shiferaw of Shiferaw Company is evaluating two mutually excluisve projects (expected cash flows shown below). The firm's cost of capital is 11.5 percent.

Year 0 1 2 3 NPV? IRR?

Project A (600) 200 310 400 - -

Project B (600) 400 260 100 - -

Calculate the NPV and IRRs for projects A and B.

a. Project A's NPV is $42.25 and Project B's NPV is $120.76. b. Project A's NPV is greater than Project B's NPV by 77.26. c.Project A's NPV is greater than Project B's NPV by 78.51. d. Project A's IRR is 21.27 percent, and Project B's IRR is 16.97.