You are deciding between two mutually exclusive investment opportunities. Both require the same initial investment of $10.4 million. Investment A will generate $1.98 million per year (starting at the end of the first year) in perpetuity. Investment B will generate $1.51 million at the end of the first year, and its revenues will grow at 2.3% per year for every year after that.

a. Which investment has the higher IRR?

b. Which investment has the higher NPV when the cost of capital is 6.5%?

c. In this case, when does picking the higher IRR give the correct answer as to which investment is the best opportunity?