Cash flows on two mutually exclusive projects

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Consider the following cash flows on two mutually exclusive projects for the Bahamas Recreation Corporation (BRC). Both projects require an annual return of 16 percent.

Year Deepwater New Sub Ride

0 −$ 995,000 −$ 1,940,000

1 415,000 990,000

2 546,000 845,000

3 465,000 840,000

a-1. Compute the IRR for both projects. (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

IRR Deepwater Fishing _____ % Submarine Ride _______ %

Calculate the incremental IRR for the cash flows. (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Incremental IRR _______%

Reference no: EM131943789

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