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NPV Detailed Calculations

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Your division is considering two investment projects, each of which requires an upfront expenditure of $15 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 6,000,000

a. What are the two projects' net present values, assuming the cost of capital is 5%, 10%, 15%.

b. What are the two projects' IRRs at these same costs of capital?

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