Big Company is evaluating two projects, Project A and Project B. Both projects are of equal risk. Big Company has a WACC of 10%.

MIRR for A = 21.93%

MIRR for B = 20.96%

If exclusive, Project A should be selected as A has higher MIRR

The NPV of project A is > project B, choose project A as it will add more value to the company.

A. Internal Rate of Return of Project "A" is 27.27%

B. The Internal Rate of Return of Project B is 36.15%.

Assuming Big Company recognizes the weaknesses of the Internal Rate of Return Method, given your answers to questions 28, 31, and 34, assuming that Projects A and B are mutually exclusive, which project would you recommend to senior management? Explain your answer.