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 | -$290 | -$400 |
1 | -387 | 134 |
2 | -193 | 134 |
3 | -100 | 134 |
4 | 600 | 134 |
5 | 600 | 134 |
6 | 850 | 134 |
7 | -180 | 134 What is each project's MIRR at a cost of capital of 14%? (Hint: Consider Period 7 as the end of Project B's life.) Do not round intermediate calculations. Round your answers to two decimal places. Project A % Project B % What is each project's MIRR at a cost of capital of 17%? (Hint: Consider Period 7 as the end of Project B's life.) Do not round intermediate calculations. Round your answer to two decimal places. Project A % Project B % What is the crossover rate? Do not round intermediate calculations. Round your answer to two decimal places. % |
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