fin 534

Your division is inconsideration two investments, each of which requires an upfront expenditure of $25 million. You estimate that the cost of capital is 10% and that the investments will produce the following after tax cash flows (in million of dollars):

Year           Project A                      Project B

1                      5                                  20

2                     10                                 10

3                     15                                  8

4                     20                                  6

Calculate the following:

Pay back period

Discounted Payback Period

Net Present Value

Internal Rate of return     

Modified Internal Rate of return