eBook An oil-drilling company must choose between two mutually exclusive extraction projects, and each requires an initial outlay at t = 0 of $11.8 million Under Pian A, all the olf would be extracted in 1 year, producing a cash flow at t = 1 of $14.16 million. Under Plan B, cash flows would be $2.0967 million per year for 20 years. The firm's WACC Is 12.2% a. Construct NPV profiles for Plans A and B. Enter your answers in millions. For example, an answer of $10,550,000 should be entered as 10.55. If an amount is zero, enter *o* Negative values, if any, should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to two decimal places Discount Rate NPV Pana NPV Plan B 0% $ million $ million 5 million million 10 million million 12 million million 15 million million 17 million million 20 million million Identify each projects IRA Do not round infermediate calculation Round your answers to two decimal places Project 996 Project B Find the crossover rate. Do not round intermediate calculation Round your answer to two decat places limits that this would take on alle independent, average risk prorects with returns greater than 12? 12 million million 15 million million 17 million million 20 million million Identify each project's IRR. Do not round intermediate calculations. Round your answers to two decimal places Project A: % % Project B: Find the crossover rate. Do not found intermediate calculations. Round your answer to two decimal places. 9 b. Is it logical to assume that the firm would take on all available independent, average-risk projects with returns greater than 12.2%? Yes If all available projects with returns greater than 12.2% have been undertaken, does this mean that cash flows from past investments have an opportunity cost of only 12.2%, because all the company can do with these cash Mows is to replace money that has a cost of 12.2% Yes Does this imply that the WACC is the correct reinvestment rate assumption for a project's cash now? NO