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NPV Your division is considering two investment projects, each of which requires an up-front expenditure of...

NPV

Your division is considering two investment projects, each of which requires an up-front expenditure of $23 million. You estimate that the investments will produce the following net cash flows:

Year Project A Project B
1 $  5,000,000 $20,000,000
2 10,000,000 10,000,000
3 20,000,000 8,000,000

What are the two projects' net present values, assuming the cost of capital is 5%? Round your answers to the nearest dollar.

Project A $ 8,107,500

Project B $ 12,026,400

What are the two projects' net present values, assuming the cost of capital is 10%? Round your answers to the nearest dollar.

Project A $ 4,835,000

Project B $ 9,454,400

What are the two projects' net present values, assuming the cost of capital is 15%? Round your answers to the nearest dollar.

Project A $ 2,058,500

Project B $ 7,211,000

What are the two projects' IRRs at these same costs of capital? Round your answers to two decimal places. Project A     %

Project B     %

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