Suppose a company is considering two independent projects, Project A and Project B. The cash outlay for Project A is $14,000. The cash outlay for Project B is $20,000. The company's cost of capital is 12%. The following table shows the after-tax cash flows. For each project, compute the NPV, the IRR, the MIRR, and indicate the accept/reject decision.
|
Year
|
Project A
|
Project B
|
|
1
|
$4800
|
$6700
|
|
2
|
$4800
|
$6700
|
|
3
|
$4800
|
$6700
|
|
4
|
$4800
|
$6700
|