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Consider the 2 following investment cash flow series in the table below. NA 0 $520,000.00 1 $260,000.00 2 $200,000.00 3 $220,000.00 $366,000.00 $150,000.00 $165,000.00 $180,000.00
Consider the 2 following investment cash flow series in the table below. NA 0 $520,000.00 1 $260,000.00 2 $200,000.00 3 $220,000.00 $366,000.00 $150,000.00 $165,000.00 $180,000.00 A) (4 marks) Calculare the IRR for each project using the trial and error method (possibly in excel). Show the NPV calculation to demonstrate that you have arrived at the correct IRR. B) (2 marks) At an MARR of 14% determine the acceptability of each project. Include the criteria used for the recommendation. C) (4 marks) If A and B are mutually exclusive projects and you must proceed with one project, which project would you select based on the rate of return on incremental investment. Include the criteria used for the recommendation. (MARR is given in Part B)
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