Consider the following projects, X and Y where the firm can only choose one. Project X costs $1200 and has cash flows of $147, $211, $352, $478, $526 in each of the next 5 years. Project Y also costs $1200, and generates cash flows of $293, $305, $438, $520 for the next 4 years, respectively. WACC=10%.

A) Draw the timelines for both projects: X and Y.

B) Calculate the projects NPVs, IRRs, payback periods.

C) If the two projects are independent, which project(s) should be chosen?

D) If the two projects are mutually exclusive, which projects should be chosen?

E) Plot NPV profiles for the two projects. Identify the projects IRRs on the graph.

F) If the WACC were 5