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Project S has a cost of $9,000 and is expected to produce benefits (cash flows) of...

Project S has a cost of $9,000 and is expected to produce benefits (cash flows) of $2,700 per year for 5 years. Project L costs $26,000 and is expected to produce cash flows of $7,100 per year for 5 years.

  1. Calculate the two projects' NPVs, assuming a cost of capital of 10%. Round your answers to the nearest cent.

    Project S $ ________    
    Project L $ ________    

    Which project would be selected, assuming they are mutually exclusive?
    _________________

  2. Calculate the two projects' IRRs. Round your answers to two decimal places.
    Project S ________ %
    Project L ________ %

    Which project would be selected, assuming they are mutually exclusive?
    _________________

  3. Calculate the two projects' MIRRs, assuming a cost of capital of 10%. Round your answers to two decimal places.

    Project S ________ %
    Project L ________ %

    Which project would be selected, assuming they are mutually exclusive?
    _________________

  4. Calculate the two projects' PIs, assuming a cost of capital of 10%. Round your answers to two decimal places.
    Project S ________    
    Project L ________    

    Which project would be selected, assuming they are mutually exclusive?
    _________________

    Which project should actually be selected?
    _________________

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