Question
Better Health, Inc. is evaluating two investment projects, each of which requires an up-front expenditure of $2.8 million. The projects are expected to produce the
Better Health, Inc. is evaluating two investment projects, each of which requires an up-front expenditure of $2.8 million. The projects are expected to produce the following net cash inflows:
Year Project A Project B
0 -$2,800,000 -$2,800,000
1 $1,100,000 $1,600,000
2 $1,500,000 $1,500,000
3 $1,800,000 $900,000 ------------------------------------------------------------
Question: What is project A's IRR? (Just number, no other signs such as "$" or "%," round to two digits after decimal point)
Question: What is project B's NPV if the cost of capital is 10 percent? (Just number, no other signs such as "$" or "%," round to an integer, no decimal point)
Question: Which one would you buy? (write either "A" or "B")
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