Rental house university is conducting rental houses in Chiang Mai. The net cost of the first house is 3,500,000 baht. If the cost of capital is 10% ( including mortgage, amortization and marketing ) the annual cash flows have the following projections that come from renting a car to Airbnb 1,200 baht / per day on average 18 days a month. The net cost of the second hose is 10,000,000 baht. If the cost of capital is 13% ( including mortgage, amortization and marketing ) the annual cash flows have the following projections that come from renting a car to Airbnb 10,000 baht / per day on average 12 days a month.

a.) What is the NPV of selecting a new machine? What is the internal rate of return ( IRR ) ?

b.) Which project will be accepted ? Explain why