A mining company is deciding whether to open a strip mine, which costs $1.5 million. Cash inflows of $13.5 million would occur at the end of Year 1. The land must be returned to its natural state at a cost of $12.5 million, payable at the end of Year 2.

1. Select the project's NPV profile. The correct sketch is -Select-ABCDItem 1 .
3. Should the project be accepted if WACC = 10%? -Select-YesNoItem 2 Should the project be accepted if WACC = 20%? -Select-YesNoItem 3
5. What is the project's MIRR at WACC = 10%? Do not round intermediate calculations. Round your answer to two decimal places. % What is the project's MIRR at WACC = 20%? Do not round intermediate calculations. Round your answer to two decimal places. % Does MIRR lead to the same accept/reject decision for this project as the NPV method? -Select-YesNoItem 6 Does the MIRR method always lead to the same accept/reject decision as NPV? (Hint: Consider mutually exclusive projects that differ in size.) -Select-YesNoItem 7

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