You are choosing between two projects. The cash flows for the projects are given in the following table ($ million):...

Question

Question

You are choosing between two projects. The cash flows for the projects are given in the following table ($ million):

a. What are the IRRs of the two projects?

b. If your discount rate is 5.1%, what are the NPVs of the two projects?

c. Why do IRR and NPV rank the two projects differently?

Answer 1

Answer #1

B10 : X r fix =IRR(B4:38) D 1 2 3 4 A B C E F Cash flows Present value Year | Project A Project B PVIF@5.1% Project | Project

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Answer 2

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