YearProject IProject J0-$3,000,000-$4,000,0001$1,200,000$1,000,0002$1,400,000$1,500,0003$1,600,000$2,000,0004$1,800,000$2,500,000Requirements:Calculate the NPV of each project at a 6% discount rate.Determine the IRR...
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Year | Project I | Project J |
0 | -$3,000,000 | -$4,000,000 |
1 | $1,200,000 | $1,000,000 |
2 | $1,400,000 | $1,500,000 |
3 | $1,600,000 | $2,000,000 |
4 | $1,800,000 | $2,500,000 |
- Calculate the NPV of each project at a 6% discount rate.
- Determine the IRR for each project.
- Identify which project should be selected based on NPV.
- Assess the payback period for both projects.
- Evaluate the impact of a 2% increase in the discount rate on the NPV of each project.
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