Question

Your company is considering two mutually exclusive projects, X and Y, whose costs and cash flows...

Your company is considering two mutually exclusive projects, X and Y, whose costs and cash flows are shown below:

Year X Y
0 -5000 -5000
1 1000 4500
2 1500 1500
3 2000 1000
4 4000 500

The projects are equally risky, and their cost of capital is 13%. You must make a recommendation, and you must base it on the modified IRR (MIRR). Calculate the two projects' MIRRs. Do not round intermediate calculations. Round your answers to two decimal places.

Project X:

Project Y:

Which project has the higher MIRR?

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