1. Project L costs $50,000, its expected cash inflows are $10,000 per year for 8 years, and its WACC is 10%. What is the project's NPV? Round your answer to the nearest cent. Do not round your intermediate calculations.

2. Project L costs $47,971.72, its expected cash inflows are $11,000 per year for 9 years, and its WACC is 14%. What is the project's IRR? Round your answer to two decimal places.

3. Project L costs $40,000, its expected cash inflows are $10,000 per year for 8 years, and its WACC is 11%. What is the project's MIRR? Round your answer to two decimal places. Do not round your intermediate calculations.

4. Project L costs $60,000, its expected cash inflows are $15,000 per year for 10 years, and its WACC is 13%. What is the project's payback? Round your answer to two decimal places.

5. Project L costs $40,000, its expected cash inflows are $9,000 per year for 8 years, and its WACC is 11%. What is the project's discounted payback? Round your answer to two decimal places.

6.

A firm with a WACC of 10% is considering the following mutually exclusive projects:

0

1

2

3

4

5

Project 1	-$500	$50	$50	$50	$220	$220
Project 2	-$400	$350	$350	$75	$75	$75

Which project would you recommend?

Select the correct answer.

a. Project 1, since the NPV1 > NPV2.

b. Neither Project 1 nor 2, since each project's NPV < 0.

c. Project 2, since the NPV2 > NPV1.

d. Both Projects 1 and 2, since both projects have IRR's > 0.

e. Both Projects 1 and 2, since both projects have NPV's > 0

7.

A firm is considering two mutually exclusive projects, X and Y, with the following cash flows:

0

1

2

3

4

Project X	-$1,000	$90	$280	$370	$650
Project Y	-$1,000	$900	$90	$55	$50

The projects are equally risky, and their WACC is 10%. What is the MIRR of the project that maximizes shareholder value? Round your answer to two decimal places. Do not round your intermediate calculations.