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You've estimated the following cash flows (in $) for two mutually exclusive projects: Year Project A Project B 0 -5,400 -8,100 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 -5,400 -8,100 1 1,325 1,325 2 2,148 2,148 3 3,861 7,777 The required return for both projects is 8%. . Part 1 What is the IRR for project A? . Part 2 What is the IRR for project B? . Part 3 Which project seems better according to the IRR method? Project A Project B . Part 4 What is the NPV for project A? . Part 5 What is the NPV for project B? . Part 6 Which project seems better according to the NPV method? Project B Project A . Part 7 Compare the answers to parts 3 and 6. If both projects are mutually exclusive, which one should you accept? Project A Project B

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