Carrot Inc. is evaluating the following capital expidentures. Each has no estimated salvage value and will...

Carrot Inc. is evaluating the following capital expidentures. Each has no estimated salvage value and will be depreciated on a straight line basis for 5 years. Project A has an investment outlay of $600,000 and project B will have an investment outlay of $900,000.

Year: Project A: Project B:

1 $150,000 $180,000

2 $150,000 $180,000

3 $120,000 $180,000

4 $100,000 $180,000

5 $50,000 $180,000

Calculate NPV for both projects at a discount rate of 12%

Calculate IRR of both projects

Expert Solution

jeff jeffy answered 2 years ago

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