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Assume and that Capital Budgeting you are evaluating two mutually exclusive projects, the cash flows of which appear below your company uses a cost of

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Assume and that Capital Budgeting you are evaluating two mutually exclusive projects, the cash flows of which appear below your company uses a cost of capital of 12% to evaluate projects such as these. Project B Cash Flows Time Project A Cash Flows -$405,000 0 -$300,000 134,000 1 -387,000 2 -193,000 134,000 3 -100,000 134,000 4 134,000 600,000 5 134,000 600,000 6 850,000 134,000 7 -180,000 0 a. Calculate the payback period and discounted payback period for projects A & B. b. Calculate the IRR and MIRR of projects A & B. Assume a reinvestment rate of 12% for the calculation of MIRR. c. Sketch the NPV profile for projects A & B. d. Determine the crossover point for these projects' NPV profiles. e. Assuming a cost of capital of 14%, which of these projects should be accepted? . Under what conditions on the cost of capital should project B be preferred to project A? If Project A and Project B are independent, which project should be undertaken

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