APPLY THE CONCEPTS: Internal rate of return

Calculate the internal rate of return for Project A and Project B (defined previously).

Enter the IRR with the percent sign (i.e. 4%).

Project A: IRR Analysis With an initial investment of $173,250 and annual cash flows of $______ , the internal rate of return for Project A is_______ .

Project B: IRR Analysis With an intial investment of $63,400 and annual cash flows of $______ , the internal rate of return for Project B is_______

Project A This project requires an initial investment of $173,250. The project will have a life of 4 years. Annual revenues associated with the project will be $90,000 and expenses associated with the project will be $40,000 for an annual net cash flow of $______.

Project B This project requires an initial investment of $63,400. The project will have a life of 4 years. Annual revenues associated with the project will be $90,000, and expenses associated with the project will be $70,000, for an annual net cash flow of $._____ .