Question: Highland Outpatient Center is evaluating two investment projects, each of which requires an up-front expenditure of $1.5 million.

Question:  Highland Outpatient Center is evaluating two investment projects, each of which requires an

up-front expenditure of $1.5 million. The projects are expected to produce the following ne cash inflows:

              Year Project A Project B

1 $500,000 $2,000,000,

2 $1,000,000 $1,000,000

3 $2,000,000 $600,000

1.      What is each project’s IRR?

2.      What is each project’s NPV, if the cost of capital is:

a.      10%

b.      5%

c.      15%

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