Q-5 Consider the following cash flows of two mutually exclusive projects for Tokyo Rubber Company. Assume the discount rate for both projects is ....... Percent (see appendix). Time 0 1 Project A - 14000 4100 9000 7500 3000 Project B -7500 3750 6000 3900 2 3 4 1 1.5 i) Calculate NPV for the above projects. Rank the projects according to NPV. ii) Calculate IRR for the above projects. Rank the projects according to IRR. iil) Do the two projects have conflicting rankings based on NPV and IRR? Do we need to calculate incremental IRR to decide which project should be chosen? If yes, calculate Incremental IRR. If no, suggest which method should be used to decide on one project. 2.5 iv) Two projects have unequal lives. Calculate Annualized Net Present Value (ANPV) of each project and choose the better project. 2 Q-5 Consider the following cash flows of two mutually exclusive projects for Tokyo Rubber Company. Assume the discount rate for both projects is ....... Percent (see appendix). Time 0 1 Project A - 14000 4100 9000 7500 3000 Project B -7500 3750 6000 3900 2 3 4 1 1.5 i) Calculate NPV for the above projects. Rank the projects according to NPV. ii) Calculate IRR for the above projects. Rank the projects according to IRR. iil) Do the two projects have conflicting rankings based on NPV and IRR? Do we need to calculate incremental IRR to decide which project should be chosen? If yes, calculate Incremental IRR. If no, suggest which method should be used to decide on one project. 2.5 iv) Two projects have unequal lives. Calculate Annualized Net Present Value (ANPV) of each project and choose the better project. 2