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Consider the following two mutually exclusive projects and their cash flows: Project t = 0 t = 2 t = 3 A +1000 -400

Consider the following two mutually exclusive projects and their cash flows: Project t = 0 t = 2 t = 3 A +1000 -400 -400 B -1200 550 400 The firm's cost of capital is 10%. Calculate the IRR and NPV of each, and what these method recommend. t = 1 -400 550

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