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Mario Brothers, a game manufacturer, has a new idea for an adventure game. It can either market the game as a traditional board game or
Mario Brothers, a game manufacturer, has a new idea for an adventure game. It can either market the game as a traditional board game or as a PC game, but not both. Consider the following cash flows of the two mutually exclusive projects. Assume the discount rate for both projects is 10 percent. |
Year | Board Game | PC | ||||
0 | −$ | 1,100 | −$ | 2,500 | ||
1 | 670 | 1,650 | ||||
2 | 800 | 1,370 | ||||
3 | 190 | 700 | ||||
a. | What is the payback period for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) |
b. | What is the NPV for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) |
c. | What is the IRR for each project? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) |
d. | What is the incremental IRR? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) |
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