Question
Cummings Products Company is considering two mutually exclusive investments whose expected net cash flows are as follows: Expected Net Cash Flows Year Project A Project
Cummings Products Company is considering two mutually exclusive investments whose expected net cash flows are as follows:
Expected Net Cash Flows | ||||
Year | Project A | Project B | ||
0 | -$400 | -$650 | ||
1 | -528 | 210 | ||
2 | -219 | 210 | ||
3 | -150 | 210 | ||
4 | 1,100 | 210 | ||
5 | 820 | 210 | ||
6 | 990 | 210 | ||
7 | -325 | 210 |
What is each project's IRR? Do not round intermediate calculations. Round your answers to two decimal places
A ? B ?
Calculate the two projects' NPVs, if each project's cost of capital was 10%. Do not round intermediate calculations. Round your answers to the nearest cent.
A ? B ?
Calculate the two projects' NPVs, if each project's cost of capital was 17%. Do not round intermediate calculations. Round your answers to the nearest cent.
A ? B ?
What is each project's MIRR at a cost of capital of 10%? (Hint: Consider Period 7 as the end of Project B's life.) Do not round intermediate calculations. Round your answers to two decimal places.
A ? B ?
Calculate the two projects' NPVs, if each project's cost of capital was 17%. Do not round intermediate calculations. Round your answers to the nearest cent.
A ? B ?
What is the crossover rate? Do not round intermediate calculations. Round your answer to two decimal places
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