### Create an Account

Home / Questions / Garage Inc has identified the following two mutually exclusive projects Year Cash Flow

# Garage Inc has identified the following two mutually exclusive projects Year Cash Flow

Garage, Inc., has identified the following two mutually exclusive projects:

 Year Cash Flow (A) Cash Flow (B) 0 -28,400 -28,400 1 13,800 4,000 2 11,700 9,500 3 8,900 14,600 4 4,800 16,200

a1. What is the IRR for each of these projects? A =17.13 % & B=16.59%.
b1. If the required return is 12 percent, what is the NPV for each of these projects? A=2633.93 & B= 3432.15
c. At what discount rate would the company be indifferent between these two projects? (I can't figure this out! )

II

An investment has an installed cost of \$533,800. The cash flows over the four-year life of the investment are projected to be \$215,850, \$232,450, \$199,110, and \$147,820.

1.If the discount rate is infinite, what is the NPV?

2.At what discount rate is the NPV just equal to zero?

May 14 2020 View more View Less