Incremental IRR: Consider the two projects as shown in the table. Your firm can only choose one of these. Year Project 1 Project 2 0 -950,000 -1,850,000 1 370,000 900,000 2 510,000 800,000 3 420,000 750,000 a. Which project has the greater IRR? b. Which project has the better NPV (assume 14%)? c. Calculate the incremental IRR of choosing the second more capital-intensive project. To do this, take the difference in the cash flows between the two projects and find the IRR on this difference. This represents the added value the more capital-intensive project will give over just choosing the smaller project.