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I am needing help with the excel formulas for the following question (the cells highlighted in green.) Problem 1. West Coast Company is considering two
I am needing help with the excel formulas for the following question (the cells highlighted in green.)
Problem 1. | West Coast Company is considering two mutually exclusive projects, the project's expected net cash flows are as follows: | |||||||
Expected Cash Flows | ||||||||
Year | Proj. A | Proj. B | ||||||
0 | ($40,000) | ($30,000) | ||||||
1 | ($12,000) | $8,500 | ||||||
2 | $10,000 | $8,500 | ||||||
3 | $35,000 | $8,500 | ||||||
4 | $14,000 | $8,500 | ||||||
5 | $25,000 | $8,500 | ||||||
Required Rate of Return | 14.00% | 14.00% | ||||||
1.c. (8 points) | Calculate the crossover rate of these two projects. | |||||||
Year | Proj. A | Proj. B | Cash Flow Difference between Proj. A & Proj. B | |||||
0 | ||||||||
1 | ||||||||
2 | ||||||||
3 | ||||||||
4 | ||||||||
5 | ||||||||
Crossover rate |
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