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Business, 10.08.2021 04:00 smokey13

Your firm has estimated the following cash flows for two mutually exclusive capital investment projects. The firm's required rate of return is 10%. The
firm uses 3 years as the cutoff for payback period method.
Year Project A Cash Flow Project B Cash Flow
0 -$185,000 -$410,000
1 55,000 120,000
2 55,000 120,000
3 55,000 110,000
4 45,000 110,000
5 45,000 90,000
6 45,000 60,000
8. Which project would you accept on the basis of IRR?
9. Is there a conflict between the methods?
10. Which project(s) would you accept and why?
11. What would be your answer to 10 above if the projects were independent?

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