13. Problem 10-13 (NPV and IRR Analysis) eBook 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 $400 $650 1 -528 210 2 219 210 3 -150 210 4 1,100 210 5 820 210 6 990 210 7 -325 210 a. Select the correct graph for NPV profiles for Projects A and B. A WPM 14001 WPM) 14001 1 2007 1000+ 800 C VPM) 14001 12001 1000 800 Pojat 6007 4001 * Project 200 D PMC5) 14001 12001 1000+ 800 Project 6007 400+ Project A 2001 1200 10001 800 600+ 400+ 2004 Project Project Project 400+ 2001 Project B 3 Torbre 20 30 45 90 -2001 Carrabbed 20 30 -4001 -200 Gostar cables 20 Coster called 20 w -4001 -2001 -400 The correct graph is y b. What is each project's IRR? Do not round intermediate calculations. Round your answers to two decimal places. Project A: Project : * : c. Calculate the two prajects' NVS, if each project's cost of capital was 10%. Do not round intermediate calculations. Round your arawers to the nearest cent. Project A: 5 Projects which project, if ther, should be selected? Select should be selected. Calculate the two projects' NPVS, if each project's cost of capital was 17%. Do not round intermediate calculations. Round your answers to the nearest cent. Project A Project B: 5 What would be the proper choice? Select is the proper choice d. 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 1747 (Hint: Consider Period 7 as the end of Project B's life.) Do not round intermediate calculation. Round your answers 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. What is its significance I. The cover rate has no significance in capital budgeting analysis. II. If the cost of capital is greater than the crossover rate, both the NPV and IRR methods will lead to the same project selection III. If the cost of capital is less than the cover rate, both the NPV and IRR methods lead to the same project selections Select