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Problem 8-10 NPV versus IRR [LO 3, 4 Romboski, LLC, has identified the following two mutually exclusive projects: Cash Flow (A) Cash Flow (B) -$52,000

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Problem 8-10 NPV versus IRR [LO 3, 4 Romboski, LLC, has identified the following two mutually exclusive projects: Cash Flow (A) Cash Flow (B) -$52,000 15,800 19,800 24,000 25,800 Year -$52,000 28,000 22,000 17,000 12,400 Requirement 1: (a) What is the IRR for each of these projects? (Do not round intermediate calculations. Enter your answer as a percentage roundedto 2 decimal places (e.g., 32.16).) Internal rate of return Project A Project B 22.83 % 2116 % (b)lf you apply the IRR decision rule, which project should the company accept? Next> 2 of 5 K Prev O1234 (b)lf you apply the IRR decision rule, which project should the company accept? Project A Requirement 2: (a)Assume the required return is 11 percent. What is the NPV for each of these projects? (Do not round intermediate calculations.Round your answers to 2 decimal places (e.g., 32.16).) Net present valu Project A Project B 11679.44 12848.2 es (b)Which project will you choose if you apply the NPV decision rule? Project B Requirement 3: (a)Over what range of discount rates would you choose Project A? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).) Project A Above Next> K Prev 2 of 5 Project B 12848.2 (b)Which project will you choose if you apply the NPV decision rule? Project B Requirement 3: (a)Over what range of discount rates would you choose Project A? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).) Project A 1% Above (b)Over what range of discount rates would you choose Project B? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).) Project B % Below (c) At what discount rate would you be indifferent between these two projects? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).) Discount % rate Next> Prev 2 of 5

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