You are considering an investment in two projects, A and B. Both projects have an initial cash

Question:

You are considering an investment in two projects, A and B.

Both projects have an initial cash outlay of $50,000 and the projected cash flows are as follows:

a. Assuming that the WACC is 15%, calculate the payback period, discounted payback period, NPV, PI, IRR, and MIRR.

If the projects are mutually exclusive, which project should be selected?

b. Create an NPV profile chart for projects A and B. What is the exact crossover rate for these two projects?

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Vishal Bandi

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