Question
Project Year 0 Year 1 Year 2 Year 3 Year 4 A $51 $27 $20 $19 $13 B $102 $18 $38 $51 $58 You are
| Project | Year 0 | Year 1 | Year 2 | Year 3 | Year 4 |
| A | $51 | $27 | $20 | $19 | $13 |
| B | $102 | $18 | $38 | $51 | $58 |
You are choosing between two projects. The cash flows for the projects are given in the following table ($ million)
a. What are the IRRs of the two projects?
b. If your discount rate is 5.1%, what are the NPVs of the two projects?
c. Why do IRR and NPV rank the two projects differently?
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The Handbook Of Mergers And Acquisitions
Authors: David Faulkner, Satu Teerikangas, Richard J. Joseph
1st Edition
0199601461, 978-0199601462
