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D Mario Brothers, a game manufacturer, has a new idea for an adventure game. It can either market the game as a traditional board
D Mario Brothers, a game manufacturer, has a new idea for an adventure game. It can either market the game as a traditional board game or as a PC game, but not both. Consider the following cash flows of the two mutually exclusive projects. Assume the discount rate for both projects is 10 percent. Year Board Game PC 1:23:04 0 -$1,600 -$3,500 1 770 2,150 2 1,350 1,650 3 290 1,200 a. What is the payback period for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) b. What is the NPV for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) c. What is the IRR for each project? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) d. What is the incremental IRR? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Answer is complete but not entirely correct. a. Board game payback 2.31 years PC game payback 1.42 years b. Board game NPV $ 136.58 x PC game NPV $ 532.55 x C. Board game IRR 11.59 x % PC game IRR d. Incremental IRR 15.00 % 18.27%
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