Software games company avalanche entertainment

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Software games company Avalanche Entertainment is considering expanding its highly successful online game franchise to either the board game or trading card environment. The company has decided that it will invest in one project but not both. The table below gives the cash flows of the two projects. Avalanche Entertainment uses a discount rate of 10 percent.
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(a) Which project should be chosen according to: a. Payback Period
b. NPV
c. IRR
d. IncrementalIRR

(b) Discuss the relevance, the main advantages and disadvantages of each of these investment appraisal techniques highlighted above. Is incremental cash flows analysis needed? Is it consistent with NPV? Comment on your findings.

Reference no: EM13941001

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