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Mario Brothers, a game manufacturer, has a new idea for an adventure game. It can either market the game as a traditional board game or

Mario Brothers, a game manufacturer, has a new idea for an adventure game. It can either market the game as a traditional board game or as an interactive DVD, but not both. Consider the following cash flows of the two mutually exclusive projects. Assume the discount rate for both projects is 8 percent.

Year Board Game DVD
0 $ 1,250 $ 2,800
1 700 1,800
2 1,000 1,580
3 220 850

a. What is the payback period for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)

Payback period
Board game ________ years
DVD ________ years

What is the incremental IRR? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Incremental IRR _________ %

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