Furthermore, the client has mentioned that they are reviewing two mutually exclusive projects, each costing $100 thousands. Your team has already analysed these projects and expected the following cash flows for each project:

Cash Flow	Project Alpha	Project Beta
Year 0	-100,000	-100,000
Year 1	32,000	0
Year 2	32,000	0
Year 3	32,000	0
Year 4	32,000	0
Year 5	32,000	200,000

The clients required rate of return was 11%. The client was using payback method to decide which project to choose. However, you have explained that NPV or IRR methods might suit the client better.

1. If the required rate of return changes, how does such change affect the projects internal rate of return? (2 marks)
2. What are assumptions of reinvestments implicitly made by NPV and IRR? Which one is better? (3 marks)
3. If there is a ranking conflict, what is the reason for that? (2 marks)
4. Which project should client accept and why? (2 marks)