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Cummings Products Company is considering two mutually excluslve Investments whose expected net cash flows are as follows: a. Select the correct graph for NPV proflles

image text in transcribed Cummings Products Company is considering two mutually excluslve Investments whose expected net cash flows are as follows: a. Select the correct graph for NPV proflles for Projects A and B. b. What is each project's IRR? Do not round intermedlate calculations. Round your answers to two dedimal places. Project A: 3% Project B: 3% c. Calculate the two projects' NPVs, If each project's cost of capltal was 10%. Do not round Intermedlate calculations. Round your answers to the nearest cent. Project A: $3 Project B: \$ 3 Which project, if elther, should be selected? Project A should be selected. Calculate the two projects' NPVs, If each project's cost of capltal was 17\%. Do not round Intermedlate calculations. Round your answers to the nearest cent. Project A: $ Project B: \$ What would be the proper cholce? Project B is the proper cholce. Project A: 3% Project B: 3% Project A: 3% Project B: 3% e. What is the crossover rate? Do not round Intermedlate calculations. Round your answer to two decimal places. 2 What is Its significance? I. If the cost of capital is greater than the crossover rate, both the NPV and IRR methods will lead to the same project selection. II. If the cost of capltal is less than the crossover rate, both the NPV and IRR methods lead to the same project selections. III. The crossover rate has no significance in capital budgeting analysis

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