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A company has a 13% WACC and is considering two mutually exclusive investments (that cannot be repeated) with the following cash flows: 0 3 4

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A company has a 13% WACC and is considering two mutually exclusive investments (that cannot be repeated) with the following cash flows: 0 3 4 5 6 7 1 Project A -$300 -$387 -$100 $600 $600 $850 -$180 -$193 $131 $131 $131 Project B -$405 $131 $131 $131 $0 a. What is each project's NPV? Negative values, if any, should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to the nearest cem Project A: $ 2 Project B: $ b. What is each project's IRR? Do not round intermediate calculations. Round your answers to two decimal places. Project A: Project B c. What is each project's MIRR? (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: d. From your answers to parts a-c, which project would be selected? If the WACC was 18%, which project would be selected? Discount Rate 0% 5 10 12 15 18.1 % e Construct NPV profiles for Projects A and B. If an amount is zero, enter 0. Negative values, if any, should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to the nearest cent. NPV Project A $ NPV Project B 12 15 18.1 23.01 f. Calculate the crossover rate where the two projects' NPVS are equal. Do not round intermediate calculations. Round your answer to two decimal places. % g. What is each project's MIRR at a WACC of 18 % 7 Do not round intermediate calculations. Round your answers to two decimal places. Project A % Project B

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