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You are choosing between two projects. The cash flows for the projects are given in the following table ($ million): a. What are the IRRs
You are choosing between two projects. The cash flows for the projects are given in the following table ($ million):
a. What are the IRRs of the two projects?
b. If your discount rate is 4.6 %, what are the NPVs of the two projects?
c. Why do IRR and NPV rank the two projects differently?
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\begin{tabular}{cccccc} Project & Year 0 & Year 1 & Year 2 & Year 3 & Year 4 \\ \hline A & $49 & $27 & $20 & $20 & $17 \\ B & $99 & $18 & $39 & $51 & $61 \\ \hline \end{tabular}Step by Step Solution
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