Consider two investments A and B with the sequences of cash flows given in the table below.

a) Compute the IRR for each investment.

The rate of return for Project A is 35.8%. (Round to one decimal place.)

The rate of return for Project B is 39.2%. (Round to one decimal place.)

(b) At MARR=16%, determine the acceptability of each project.

Would you accept Project A? Choose the correct answer below.

Yes

Would you accept Project B? Choose the correct answer below.

Yes

(c) If A and B are mutually exclusive projects, which project would you select based on the rate of return on incremental investment at MARR=15%?

The rate of return on the incremental investment is ______%. (Round to one decimal place.)

Which project would you select based on the rate of return on incremental investment at MARR=15%?

Project A or B?

Net Cash Flow Project A Project B - $100,000 30,000 30,000 170,000 -$115,000 40,000 40,000 160,000