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A company has a 11% WACC and is considering two mutually exclusive investments (that cannot be repeated) with the following cash flows: Project A -$300

A company has a 11% WACC and is considering two mutually exclusive investments (that cannot be repeated) with the following cash flows:

Project A -$300 -$387 -$193 -$100 $600 $600 $850 -$180

Project B -$400 $133 $133 $133 $133 $133 $133 $0

  1. What is each project's NPV? Round your answer to the nearest cent. Do not round your intermediate calculations.

    Project A: $

    Project B: $

  2. What is each project's IRR? Round your answer to two decimal places.

    Project A:

    Project B:

  3. What is each project's MIRR? (Hint: Consider Period 7 as the end of Project B's life.) Round your answer to two decimal places. Do not round your intermediate calculations.

    Project A:

    Project B:

  4. From your answers to parts a-c, which project would be selected?

  5. If the WACC was 18%, which project would be selected?

  6. Construct NPV profiles for Projects A and B. Round your answers to the nearest cent. Do not round your intermediate calculations. Negative value should be indicated by a minus sign.

    Discount Rate NPV Project A NPV Project B
    0% $ $
    5 $ $
    10 $ $
    12 $ $
    15 $ $
    18.1 $ $
    24.18 $ $

  7. Calculate the crossover rate where the two projects' NPVs are equal. Round your answer to two decimal places. Do not round your intermediate calculations.

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