Answer the following questions

1. a) "The internal rate of return approach assumes reinvestment of the intermediate cash flows at the internal rate of return."- is this claim correct? Are IRR and the required rate of return the same? b) Consider the following two mutually exclusive projects: Period Cash flow Cash flow (Y) (Z) 0 -10,000 -10,000 5,400 4,500 N 3,400 3,600 4,500 5,400 Graphically present the NPV profiles of these two projects. What is the crossover rate for these two projects