1. In Problem 11-13 on page 406 of your book, calculate the NPV, IRR, and MIRR of Project X. (DO NOT do the question as asked in the problem.) CALCULATE ALL YOUR ANSWERS TO TWO DECIMAL PLACES. STATE THE IRR AND MIRR IN PERCENT BUT DO NOT USE A PERCENT SIGN.
2. Go to Problem 13-9 on page 488 to answer the next two questions. Answer question a. in the next blank. GIVE YOUR ANSWER WITH DECIMAL PLACES. DO NOT USE A DOLLAR SIGN.

11-13 MIRR. A firm is considering two mutually exclusive projects, X and Y, with the following cash flows: 1 2 3 H Project X -$1,000 $110 $300 $430 $700 Project Y -$1,000 $1,100 $90 $55 $50 The projects are equally risky, and their WACC is 11%. What is the MIRR of the project that maximizes shareholder value? 13-9 RECAPITALIZATION Tartan Industries currently has total capital equal to $4 million, has zero debt, is in the 40% federal-plus-state tax bracket, has a net income of $1 million, and distributes 40% of its earnings as dividends. Net income is expected to grow at a constant rate of 3% per year, 200,000 shares of stock are outstanding, and the current WACC is 12.30%. The company is considering a recapitalization where it will issue $2 million in debt and use the proceeds to repurchase stock. Investment bankers have estimated that if the company goes through with the recapitalization, its before-tax cost of debt will be 10% and its cost of equity will rise to 15.5%. a. What is the stock's current price per share (before the recapitalization)? b. Assuming that the company maintains the same payout ratio, what will be its stock price following the recapitalization? Assume that shares are repurchased at the price calculated in part a. 11-13 MIRR. A firm is considering two mutually exclusive projects, X and Y, with the following cash flows: 1 2 3 H Project X -$1,000 $110 $300 $430 $700 Project Y -$1,000 $1,100 $90 $55 $50 The projects are equally risky, and their WACC is 11%. What is the MIRR of the project that maximizes shareholder value? 13-9 RECAPITALIZATION Tartan Industries currently has total capital equal to $4 million, has zero debt, is in the 40% federal-plus-state tax bracket, has a net income of $1 million, and distributes 40% of its earnings as dividends. Net income is expected to grow at a constant rate of 3% per year, 200,000 shares of stock are outstanding, and the current WACC is 12.30%. The company is considering a recapitalization where it will issue $2 million in debt and use the proceeds to repurchase stock. Investment bankers have estimated that if the company goes through with the recapitalization, its before-tax cost of debt will be 10% and its cost of equity will rise to 15.5%. a. What is the stock's current price per share (before the recapitalization)? b. Assuming that the company maintains the same payout ratio, what will be its stock price following the recapitalization? Assume that shares are repurchased at the price calculated in part a