Your company has to choose between two mutually exclusive business deals. Both deals would cost $200. deal 1 is expected to generate cash flows of \$150 in Year 1, $100 in Year 2 and $20M Year 3. deal 2 expected to generate a cash flow of $500 in Year 5 and thats it, nothing else. The appropriate cost of capital (discount) for both projects is 6%.

Q1. What are the IRR and NPV of the two projects?

Q2. Do IRR and NPV disagree about which project is better ? so, explain why they disagree in this case.

Q3. Which project should your company choose ? Why?