company is considering two mutually exclusive expansion plans. Plan A requires a $39 million expenditure on a large-scale integrated plant that would provide expected cash flows of $6.23 million per year for 20 years. Plan B requires a $11 million expenditure to build a somewhat less efficient, more labor-intensive plant with an expected cash flow of $2.47 million per year for 20 years. The firm's WACC is 9%. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below.

Calculate each project's NPV. Round your answers to two decimal places. Do not round your intermediate calculations. Enter your answers in millions. For example, an answer of $10,550,000 should be entered as 10.55.

Plan A: $ million

Plan B: $ million

Calculate each project's IRR. Round your answer to two decimal places.

Plan A: %

Plan B: %

By graphing the NPV profiles for Plan A and Plan B, approximate the crossover rate to the nearest percent.

%

Calculate the crossover rate where the two projects' NPVs are equal. Round your answer to two decimal places.

%

Why is NPV better than IRR for making capital budgeting decisions that add to shareholder value? The input in the box below will not be graded, but may be reviewed and considered by your instructor.

900% Doliars in Milions Plan A 539.00 23 6.235. 23 0.23 .23 .23.23 55.23 .23 6.23.23623 6 23$6.23 23 23$.23 56 23 $11.00 $2 47 247247 47 Plan B 2.47$247 $2.47$247 $2.47 $2.47 2.47 2.472.47$247 S24 247 S2 4747 2.47 Project NPV Calculations NPVA NPVe Project IRR Calculations NPV Profiles Discount Rates NPVA 30.00 30.00 50.00 $0.00 30.00 30.00 50.00 $0.00 0.00 0.00 0.00 10% 1596 0.00 $0.00 50.00 $0.00 NPV Profiles $1.00 50.80 50.70 50 60 5050 50.40 50 20 50 10 25% Calculaion of Crossover Rate Plan A $30.00 $238.2323 23 $82 .23$623 $8.2 $8.228238.23 8.23 $8.2323 $.23 %823 623 $8.23$239823$823 $8 23