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The answer says:
The Internal Rate of return (IRR)
The IRR is basically the discount rate that produces an NPV of zero for net project cash flows. If the selection is between two projects with the same scale of investment (which is the case here), then it has no effect on which project is selected.
Why is it saying that both the projects have the same scale of investment?
Again it says in the answer:
These intangible benefits amount to $110,000 for Job One and $50,000 for Job Two. If these intangible benefits are deducted from the analysis then, in fact, Job Two has a higher NPV than Job One. However, both are negative, suggesting that neither project should be attempted.
I didn’t understand how they get figures $110,00 and $ 50,000.
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