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PROBLEM 4 ( Jungle Juice Corporation has identified the following two mutually exclusive projects: a ) What is the Internal Rate of Return ( IRR

PROBLEM 4(
Jungle Juice Corporation has identified the following two mutually exclusive projects:
a) What is the Internal Rate of Return (IRR) for each of these projects? (
b) Using the IRR decision rule, which project should the company accept? (a)
c) If the required return is 11 percent, what is the Net Present Value (NPV) for each of these
projects?
d) Using the NPV decision rule, which project should the company accept?
e) Why do you think the NPV and IRR rules do not agree on same project approval/rejection
direction? (ser)
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