A firm with a $14\%$ WACC is evaluating two projects for this year's capital budget. After$-$tax cash flows, including depreciation, are as follows:

Project $M$

Project $N$

a$.$ Calculate NPV for each project. Do not round intermediate calculations. Round your answers to the nearest cent.

Project M: $

Project N: $

Calculate IRR for each project. Do not round intermediate calculations. Round your answers to two decimal places.

Project M:

$\%$

Project N:

$\%$

$\%$

Calculate MIRR for each project. Do not round intermediate calculations. Round your answers to two decimal places.

Project M:

$\%$

Project $N$ :

$\%$

Calculate payback for each project. Do not round intermediate calculations. Round your answers to two decimal places.

Project M:

years

Project $N$ :

years

Calculate discounted payback for each project. Do not round intermediate calculations. Round your answers to two decimal places.

Project M:

years

Project $N$ :

years

b$.$ Assuming the projects are independent, which one$($s$)$ would you recommend?

Only Project M would be accepted because NPV$($M$)>$ NPV$($N$).$

c$.$ If the projects are mutually exclusive, which would you recommend?

d$.$ Notice that the projects have the same cash flow timing pattern. Why is there a conflict between NPV and IRR?

The conflict between NPV and IRR is due to the fact that the cash flows are in the form of an annuity.