NPV and IRR Analysis
Cummings Products Company is considering two mutually exclusive investments whose expected net cash flows are as follows:
EXPECTED NET CASH FLOWS | ||
Year | Project A | Project B |
0 | -$300 | -$405 |
1 | -387 | 134 |
2 | -193 | 134 |
3 | -100 | 134 |
4 | 600 | 134 |
5 | 600 | 134 |
6 | 850 | 134 |
7 | -180 | 134 |
What is each project's MIRR at a cost of capital of 10%? (Hint:
Consider Period 7 as the end of Project B's life.) Do not round
intermediate calculations. Round your answers to two decimal
places.
Project A %
Project B %
What is each project's MIRR at a cost of capital of 17%? (Hint:
Consider Period 7 as the end of Project B's life.) Do not round
intermediate calculations. Round your answer to two decimal
places.
Project A %
Project B %
What is the crossover rate? Do not round intermediate
calculations. Round your answer to two decimal places.
%
Get Answers For Free
Most questions answered within 1 hours.