Calculate the irr for project a

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Reference no: EM132488127

Consider the cash flows for two proposed capital budgeting projects given below. The cost of capital is 12% for both projects.

Year    Project A        Project B

0        -20,000            -10,000

1         8,000                4,000

2           8,000             5,000

3            6,000             4,000

4             8,000              3,000

  • Project B's NPV is calculated as $2311.07, its IRR is 23.1%, and its payback period is 2.25 years.

Question 1: Calculate the NPV for Project A.

Question 2: Calculate the IRR for Project A.

Question 3: Calculate the Payback for Project A.

Question 4: If they are independent projects, what's your acceptance/rejection decision? And why?

Reference no: EM132488127

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