Question
You are choosing between two projects. The cash flows for the projects are given in the following table ($ million): PROJECT YEAR 0 YEAR 1
You are choosing between two projects. The cash flows for the projects are given in the following table ($ million):
| PROJECT | YEAR 0 | YEAR 1 | YEAR 2 | YEAR 3 | YEAR 4 |
| A | -$50 | $25 | $22 | $22 | $13 |
| B | -$101 | $21 | $39 | $49 | $60 |
1. What are the IRRs of the two projects?
2. If your discount rate is 4.6%, what are the NPVs of the two projects?
3. Why do IRR and NPV rank the two projects differently?
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An Audit Is An Audit Is An Audit
Authors: Marina Peters
1st Edition
B08B37VNZ6, 979-8652328412
