Company XYZ is attempting to evaluate the feasibility of investing in two projects with six years life. The firm has estimated the associated cash inflows as shown in the following table. The following net cash flows relate to two projects: 0 -100,0 -80,0 NET CASH FLOWS (IN $ 1,000) 1 2 3 4 10,0 20,0 30,0 40,0 50,0 25,0 20,0 10,0 5 50,0 10,0 6 10,0 10,0 YEAR PROJECT A PROJECT B ri= % PROJECT A PROJECT B r2= % PROJECT A PROJECT B NPV ri IRR =ri + -(r2 - 1) NPV - NPV r2 1. Calculate payback period for the proposed investment. 2. Calculate the NPVs for each project, assuming 10% cost of capital. 3. Assuming that the two projects are independent, would you accept them if the cost of capital is 15%? 4. What is the IRR of each project? Calculate IRR and graph the NPV-curve for both projects! 5. Which of the two projects would you prefer if they are mutually exclusive, given a 15% discount rate