You've estimated the following cash flows $($in $$)$ for two mutually exclusive projects:

Year Project A Project B

$0-5,200-7,800$

$11,3251,325$

$22,1482,148$

$33,5647,310$

The required return for both projects is $8\%.$

What is the IRR for project A$?$

What is the IRR for project B$?$

Which project seems better according to the IRR method?

What is the NPV for project A$?$

What is the NPV for project B$?$

Which project seems better according to the NPV method?

Compare the answers to parts $3$ and $6.$ If both projects are mutually exclusive, which one should you accept?