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J. Marcel Enterprises has gathered projected cash flows for two projects. Year Project I Project J 0 $265,000 $265,000 1 113,500 94,000 2 106,000 100,500
| J. Marcel Enterprises has gathered projected cash flows for two projects. |
| Year | Project I | Project J |
| 0 | $265,000 | $265,000 |
| 1 | 113,500 | 94,000 |
| 2 | 106,000 | 100,500 |
| 3 | 90,000 | 102,500 |
| 4 | 79,000 | 109,500 |
| Requirement 1: |
| At what interest rate would the company be indifferent between the two projects? |
| Interest rate of return | % |
| Requirement 2: |
| Which project is better if the required return is above this interest rate? |
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