A project's internal rate of return $($IRR$)$ is the $$ that forces the PV of its inflows to equal its cost. The IRR is an estimate of the project's rate of return, and it is comparable to the $$ on a bond. The equation for calculating the IRR is:

$NPV=C{F}_0+\frac{C{F}_1}{(1+\text{I}\text{R}\text{R}{)}^1}+\frac{C{F}_2}{(1+\text{I}\text{R}\text{R}{)}^2}+$dots$+\frac{C{F}_N}{(1+\text{I}\text{R}\text{R}{)}^N}=0$

$0={\displaystyle \underset{t=1}{\overset{N}{}}}\frac{C{F}_t}{(1+\text{I}\text{R}\text{R}{)}^t}$

particular discount rate that causes NPV to equal $$

The IRR calculation assumes that cash flows are reinvested at the $$ IRR $.$ If the IRR is $$ greater $$ than the project's risk$-$adjusted cost of capital, then the project should be accepted; however, if the IRR is less than the project's risk$-$adjusted cost of capital, then the project should be $.$ Because of the IRR reinvestment rate assumption, when $$ projects are evaluated the IRR approach can lead to conflicting results from the NPV method. Two basic conditions can lead to conflicts between NPV and IRR: timing $$ differences $($earlier cash flows in one project vs$.$ later cash flows in the other project$)$ and project size $($the cost of one project is larger than the other$).$ When mutually exclusive projects are considered, then the NPV $$ method should be used to evaluate projects. firm's average project. Bellinger's WACC is $11\%.$

What is Project A$\text{'}$s IRR? Do not round intermediate calculations. Round your answer to two decimal places.

$\%$

What is Project B$\text{'}$s IRR? Do not round intermediate calculations. Round your answer to two decimal places.

$\%$

If the projects were independent, which project$($s$)$ would be accepted according to the IRR method?

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If the projects were mutually exclusive, which project$($s$)$ would be accepted according to the IRR method?

Project A

Could there be a conflict with project acceptance between the NPV and IRR approaches when proiects are mutually exclusive