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Garage, Inc., has identified the following two mutually exclusive projects Year Cash Flow (A) Cash Flow (B) - 29,300- 29,300 4,450 9,950 15,500 17,100 14,700
Garage, Inc., has identified the following two mutually exclusive projects Year Cash Flow (A) Cash Flow (B) - 29,300- 29,300 4,450 9,950 15,500 17,100 14,700 12,600 9,350 5,250 2 4 a-1 What is the IRR for each of these projects? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) IRR Project A Project B a-2 Using the IRR decision rule, which project should the company accept? ProjectA Project B a-3 Is this decision necessarily correct? O Yes O No b-1 If the required return is 11 percent, what is the NPV for each of these projects? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) NPV Project A Project B b-2 Which project will the company choose if it applies the NPV decision rule? O Project A O Project lB c. At what discount rate would the company be indifferent between these two projects? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Discount rate
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