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A firm with a 1 3 % WACC is evaluating two projects for this year's capital budget. After - tax cash flows, including depreciation, are
A firm with a WACC is evaluating two projects for this year's capital budget. Aftertax cash flows, including depreciation, are
as follows:
Project M
Project
a Calculate NPV for each project. Do not round intermediate calculations. Round your answers to the nearest cent.
Project M: $
Project :$
Calculate IRR for each project. Do not round intermediate calculations. Round your answers to two decimal places.
Project M:
Project N:
Calculate MIRR for each project. Do not round intermediate calculations. Round your answers to two decimal places.
Project M:
Project N:
Calculate payback for each project. Do not round intermediate calculations. Round your answers to two decimal places.
Project M:
years
Project N:
years
Calculate discounted payback for each project. Do not round intermediate calculations. Round your answers to two decimal
places.
Project M:
years
Project :
years
b Assuming the projects are independent, which ones would you recommend?
c If the projects are mutually exclusive, which would you recommend?
d Notice that the projects have the same cash flow timing pattern. Why is there a conflict between NPV and IRR?
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