Romboski, LLC, has identified the following two mutually exclusive projects:

Year Cash Flow (A) Cash Flow (B)

0 ?$ 51,000 ?$ 51,000

1 27,000 14,900

2 21,000 18,900

3 16,500 23,000

4 12,200 25,900

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 %

(b) If you apply the IRR decision rule, which project should the company accept?

Requirement 2:

(a)

Assume the required return is 10 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 value

Project A $

Project B $

(b) Which project will you choose if you apply the NPV decision rule?

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 @ %

(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 @ %

(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 %