What is the npv and irr of the two projects

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Question - Projects 1 and 2 have similar outlays, although the patterns of future cash flows are different. The cash flows as well as the NPV and IRR for the two projects are shown below. For both projects, the required rate of return is 10 percent.

Year

CF for Project 1

CF for Project 2

0

$(50.00)

$(50.00)

1

$20.00

$0

2

$20.00

$0

3

$20.00

$0

4

$20.00

$100.00

Required -

1. What is the NPV and IRR of the two projects?

2. If the two projects are mutually exclusive, what is the appropriate investment decision?

3. Would your answer change if the projects were independent?

Reference no: EM132980276

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