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Answer the next three questions pertaining to two MUTUALLY EXCLUSIVE projects on the following figure. NPV ($) A B (%) O 8% 11% 14% If

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Answer the next three questions pertaining to two MUTUALLY EXCLUSIVE projects on the following figure. NPV ($) A B (%) O 8% 11% 14% If r = 6%, which project would you choose by using the net present value (NPV) as the criterion? Neither Project B Project A Either Given r = 6%, which project would you choose if you decide to use the internal rate of return (IRR) as the criterion? Neither Project A Either Project B Question 6 At what discount rate will you be indifferent to these two projects under the NPV rule? 14% 0% 11% 8%

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