• *** I already have the correct answers,.... I am looking to understand. I HAVE TO USE A FINANCE CALCULAOR! Please do not explain to me in the excel spread sheet. PLEase tell me why you did something a certain way.. don't just do it. I am looking for actually understand. This is an on line class and the instructor does not email back. *********
• CummingsProductsisconsideringtwomutuallyexclusiveinvestmentswhoseexpectednetcashflowsareasfollow

expected net CF
year	project a	project b
0	-400	-650
1	-528	210
2	-219	210
3	-150	210
4	1100	210
5	820	210
6	990	210
7	-325	210

• 1. ConstructNPVprofilesforProjectsAandB.
  2. WhatiseachprojectsIRR?Answer.
  3. Ifeachprojectscostofcapitalwere10%,whichproject,ifeither,shouldbeselected?Ifthecostofcapitalwere17%,whatwouldbetheproperchoice?Answer..
  4. WhatiseachprojectsMIRRatthecostofcapitalof10%?At17%?(Hint:ConsiderPeriod7astheendofProjectBslife.)Answer
     • (1).
     • (2).
  5. Whatisthecrossoverrate,andwhatisitssignificance?Answer.