Q3. You are deciding between two mutually exclusive investment opportunities. Both require the same initial investment of $10.4 million. Investment A will generate $2.06 million per year (starting at the end of the first year) in perpetuity. Investment B will generate $1.59 million at the end of the first year, and its revenues will grow at 2.2% per year for every year after that.

a. Which investment has the higher IRR?

b. Which investment has the higher NPV when the cost of capital is 7.6%?