Mahjong, Inc., has identified the following two mutually exclusive projects:

Year       Cash Flow (A)    Cash Flow (B)

0              –$40,000              –$40,000      

1              19,300                   5,700      

2              14,800                   12,200      

3              12,300                   18,700      

4              9,300                     22,700

Required:

(a) What is the IRR for Project A? (17.78%, 17.44%, 16.42%, 16.08%, 16.93%)

(b) What is the IRR for Project B? (14.45%,14.88%,14.02%,13.73%,15.17%)

(c) If the required return is 8 percent, what is the NPV for Project A? (7158.9,6800.95,7373.67,6944.13,7516.84)

(d) If the required return is 8 percent, what is the NPV for Project B? (7267.15, 6903.79, 7485.16,7049.14, 7630.51)

(e) At what discount rate would the company be indifferent between these two projects? (8.31%,7.89%,8.06%,8.73%,8.56%)