Crossover rate, Equity return or Interest rate

3 Quantitative Problem: Bellinger Industries is considering two projects for inclusion in its capital budget, and you have been asked to do the analysis. Both projects' after-tax cash flows are shown on the time line below. Depreciation, salvage values, net operating working capital requirements, and tax effects are all included in these cash flows. Both projects have 4-year lives, and they have risk characteristics similar to the firm's average project. Bellinger's WACC is 12%. 0 1 2 4 1 | 1 Project A 550 420 280 310 Project B -950 410 315 395 500 -950 What is Project Delta's IRR? Do not round intermediate calculations. Round your answer to two decimal places. 25.49 % Show All Feedback What is the significance of this IRR? It is the equity return *, after this point when mutually exclusive projects are considered there is no conflict in project acceptance between the NPV and IRR approaches. Review the graphs below. Select the graph that correctly represents the correct NPV profile for Projects A and B by using the following drop-down menu. | NPV Profiles A NPV Profiles B NPV Profiles c NPV Profiles D NPV 600 INPV IN PV 600$ 5001 400 IN PV 600 500 400 6004 500- 400 500+ 400 300+ 200 300 300 3001 200+ 200 100 200 100 100 100 5 10 15 20 30 5 10 15 20 5 10 15 20 26 30 5 10 15 20 25 30 -100 -100 -100 -100 Cost of Capital -200 Cost of Capital -2001 Cost of Capital -200 Cost of Capital -200 -3001 -400+ -300 -400+ -300 -400+ -300 -400+