Question
Mahjong, Inc., has identified the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 $43,000 $43,000 1 23,000 7,000 2 17,900
Mahjong, Inc., has identified the following two mutually exclusive projects: |
Year | Cash Flow (A) | Cash Flow (B) |
0 | $43,000 | $43,000 |
1 | 23,000 | 7,000 |
2 | 17,900 | 13,800 |
3 | 12,400 | 24,000 |
4 | 9,400 | 26,000 |
Required: |
(a) | The IRR for Projects A and B is percent and percent respectively. (Do not include the percent signs (%). Round your answers to 2 decimal places. (e.g., 32.16)) |
(b) | If the required return is 11 percent, the NPV for Projects A and B is $ and $, respectively. You will choose Project (Click to select)AB if you apply the NPV decision rule. (Do not include the dollar signs ($). Round your answers to 2 decimal places. (e.g., 32.16)) |
(c) | At a discount rate of percent, you would be indifferent between these two projects. (Do not include the percent sign (%). Round your answer to 2 decimal places. (e.g. 32.16) |
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