Question
You've estimated the following cash flows (in $) for two mutually exclusive projects: Year Project A Project B 0 -5,300 -7,950 1 1,325 1,325 2
You've estimated the following cash flows (in $) for two mutually exclusive projects:
| Year | Project A | Project B |
| 0 | -5,300 | -7,950 |
| 1 | 1,325 | 1,325 |
| 2 | 2,148 | 2,148 |
| 3 | 3,759 | 7,505 |
The required return for both projects is 8%.
A) What is the IRR for project A? What about Project B?
B) What is the NPV for project A? What about Project B?
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Financial management theory and practice
Authors: Eugene F. Brigham and Michael C. Ehrhardt
12th Edition
978-0030243998, 30243998, 324422695, 978-0324422696
