Question: 1. If an investment requires an outlay today of $10,000 cash and, over the 5- year life of the investment, total cash returns were $12,000, and the $12,000 had a present value of $9,500, would you make the investment? Explain.
2. Contrast the NPV and the IRR methods of evaluating investment proposals.
3. Under what circumstances might NPV and IRR give conflicting decisions in the ranking of proposed investments?