Npv rank the two projects differently

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Reference no: EM131081244

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

Project Year 0 Year 1 Year 2 Year 3 Year 4

A -$48 $24 $20 $21 $15

B -$101 $20 $40 $51 $60

A. What are the IRRs of the two projects?

B. If your discount rate is 5.1%, what are the NPV's of the two projects?

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

Reference no: EM131081244

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