The above Figure depicts the NPV profiles of two mutually exclusive projects with the following additional information. Both projects require the same initial investment of $25 million. IRR of Project P = 20%; IRR of Project Q = 16% At a discount rate of 8%, both projects have equal NPV of $5,604,000 Based on the above information answer the following questions: (i) If the discount rate is 6%, which project is chosen and why. (ii) If the discount rate is 10% which project is chosen and why. (iii) If the discount rate is 13% and if Projects P and Q are not mutually exclusive and there are enough funds for both projects, which project would you choose. Explain your choice. (iv) If the discount rate is 22% and if Projects P and Q are not mutually exclusive and there are enough funds for both projects, which project would you choose. Explain your choice. Notes: Please note that this question does not require any calculations. You may provide your answer as text information in the response box below (or attach a word or an excel file).

NPV Profiles of Two Mutually Exclusive Projects 10000 8000 6000 4000 2000 10 11 12 13 14 15 16 18 19 20 22 23 24 25 2000 -NPV of PNPV of