Consider the following projects being considered by TeeYou Products:

View the projects.

Compute the IRR of each project, and use this information to identify the better investment.

View the Present Value of $$1$ table.

View the Present Value of Ordinary Annuity of $$1$ table.

The IRR for each project is:

Project A:

Project B:

Projects

Project A: Costs $$320,000$ and offers $8$ annual net cash inflows of $$59,000.$ TeeYou Products requires an annual return of $14\%$ on investments of this nature.

Project B: Costs $$372,000$ and offers $9$ annual net cash inflows of $$71,000.$ TeeYou Products demands an annual return of $12\%$ on investments of this nature.