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Garage, Inc., Has Identified The Following Two Mutually Exclusive Projects:

ually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 -$ 28,300 -$ 28,300 1 13,700 3,950 2 11,600 9,450 3 8,850 14,500 4 4,750 16,100 a-1 What is the IRR for each of these projects? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) IRR Project A % Project B % a-2 Using the IRR decision rule, which project should the company accept? Project A Project B a-3 Is this decision necessarily correct? Yes No b-1 If the required return is 10 percent, what is the NPV for each of these projects? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) NPV Project A $ Project B $ b-2 Which project will the company choose if it applies the NPV decision rule? Project A Project B c. At what discount rate would the company be indifferent between these two projects? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Discount rate %
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Project A 16.88 % Project B 16.45 % project A no, not necessarily correct via IRR NPV Project A $ 3634.77 Project B $ 4991.41 project b HOW TO COMPUTE DISCOUNT RATE AKA CROSSOVER RATE?

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