NPV Versus Internal Rate of Return Nguyen Hospital is considering two different low-field MRI systems: the Clearlook System and the Goodview System. The projected annual revenues, annual costs, capital outlays, and project life for each system (in after-tax cash flows) are as follows: Annual revenues Clearlook Goodview $720,000 $900,000 Annual operating costs 445,000 655,000 System Investment 900,000 800,000 Project life 5 years 5 years Assume that the cost of capital for the company is 8 percent. The present value tables provided in Exhibit 198.1 and Exhibit 198.2 must be used to solve the following problems. Required: 1. Calculate the NPV for the Clearlook System. $286,124 X 2. Calculate the NPV for the Goodview System. Which MRI system would be chosen? Clearlook System 3. What if Nguyen Hospital wants to know why IRR is not being used for the investment analysis? Calculate the IRR for each project. Round the discount factor to three decimal places. Round the IRR to the nearest whole percentage value (for example, 10.6% rounds to 11% and should be entered as "11" in the answer box.) Discount factor IRR Clearlook: % Goodview: % Why IRR is not suitable for choosing among these mutually exclusive Investments. IRR does not reveal the absolute dollar contribution that each project makes