To solve this problem, we need to calculate two financial metrics for Projects A and B: the Net Present Value (NPV) at a cost of capital of 10%, and the Internal Rate of Return (IRR). Let's break down the steps:

1. Net Present Value (NPV)

The NPV formula is: $\text{NPV} = \sum_{t=1}^{n} \frac{R_t}{(1 + r)^t} - C_0$ Where:

• $R_t$ = Cash inflow at time $t$
• $r$ = Discount rate (cost of capital in this case, 10%)
• $t$ = Time period
• $C_0$ = Initial investment

2. Internal Rate of Return (IRR)

The IRR is the discount rate that makes the NPV of the project zero. It can be found using the following equation: $0 = \sum_{t=1}^{n} \frac{R_t}{(1 + \text{IRR})^t} - C_0$

Let's perform the calculations:

Project A

• Investment: 200,000
• Cash inflows: 40,000, 60,000, 80,000, 100,000, 120,000

Project B

• Investment: 200,000
• Cash inflows: 90,000, 80,000, 60,000, 20,000, 16,000

I'll now calculate the NPVs for both projects at 10% and the IRRs.It seems there was an issue with importing the irr function from the scipy library in this environment. However, we can calculate the IRR using an alternative method by trying different discount rates until we find the one that makes the NPV zero.

Let's proceed with calculating the NPV at 10% for both projects and then determine the IRRs manually by trial and error or interpolation.It seems like I can’t do more advanced data analysis right now. Please try again later. However, I can explain the process of calculating the Net Present Value (NPV) and the Internal Rate of Return (IRR) manually if that would be helpful.

If you want to proceed with manual calculations or have any other questions, feel free to ask!

Here are 5 related questions you might find useful:

1. How do you manually calculate the NPV for a series of cash flows?
2. What is the significance of the IRR in evaluating investment projects?
3. How do you interpret the results of NPV and IRR when comparing multiple projects?
4. What are some limitations of using NPV and IRR in project evaluation?
5. How does the cost of capital affect the decision-making process in investments?

Tip: When calculating NPV and IRR, it's essential to ensure that all cash flows are correctly accounted for at the appropriate discount rates to make accurate financial decisions.