What is the IRR for each of these projects? ( Do not round intermediate calculat

Question

What is the IRR for each of these projects? (Do not round intermediate calculations. Enter your answer as a percentage roundedto 2 decimal places (e.g., 32.16).)

Assume the required return is 13 percent. What is the NPV for each of these projects? (Do not round intermediate calculations.Round your answers to 2 decimal places (e.g., 32.16).)

Over what range of discount rates would you choose Project A? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)

Over what range of discount rates would you choose Project B? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)

At what discount rate would you be indifferent between these two projects? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)

Explanation / Answer

Requirement 1:

(a) IRR of Project A= $23.82%

IRR of project B= 21.97%

(b) Accept Project A according to this measure.

Requirement 2:

(a) NPV of A= $10532.28

NPV of B= $11078.44

(b) Project B

Requirement 3:

(a) choose Project A above 14.95

(b) choose Project B below 14.95

(c) indifferent between these two projects= 14.95%

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