# Vcgc

In a 1,050-1,500-word memo, define, analyze, and interpret the answers to items (c) through (h).   In that same memo, present the rationale behind each item and why it supports your decision stated in item (i). Also, attempt to describe the relationship
between NPV and IRR. (Hint: The key factor here is the discount rate used.) In this memo, explain how you would analyze projects differently if they had unequal projected years (i.e., if Corporation A had a 5-year projection and Corporation B had a 7-year projection)

Please find below a detailed comparative analysis of both corporations.   Based on this analysis, I would recommend acquiring corporation B as it mainly has a higher net present value than corporation A.

|                |                                        |Corporation A           |Corporation B           |
|c               |NPV                                     |\$20,979.20             |\$48,035.14             |
|d               |IRR                                     |13.05%                 |16.94%                 |
|e               |Payback Period                         |3.64 years             |3.3 years               |
|f               |PI                                     |1.08                   |1.19                   |
|g               |Discounted Payback Period               |4.6 years               |4.1 years               |
|h               |MIRR                                   |11.79%                 |13.94%                 |

Net Present Value (NPV) is defined as the difference between an investment’s market value and its cost.   The rule here is that we accept projects with a net present value greater than zero, and decline the ones with a net present value that is less than zero.   The higher the net present value, the more desirable the investment is.   Based on that, Corporation B is preferable to Corporation A as it has a higher net present value.

Internal Rate of Return (IRR) is defined as the rate of return that...