Which project should be accepted if are independent

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Assume your organization is considering two investment projects, each of which requires an upfront expenditure of $25 million. You estimate that the cost of capital is 10% and that the investments will produce the following after-tax cash flows (in millions of dollars):

Year        Project A               Project B

1                  5                        20

2                10                        10

3                 15                       8

4                    20                      6

Question 1: According to internal rate of return (IRR) which project should be accepted if they are independent?

Reference no: EM132531698

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