NPV and IRR Analysis

Cummings Products Company is considering two mutually exclusive investments whose expected net cash flows are as follows:

	EXPECTED NET CASH FLOWS
Year	Project A	Project B
0	-$280	-$430
1	-387	134
2	-193	134
3	-100	134
4	600	134
5	600	134
6	850	134
7	-180	134

1. What is each project's MIRR at a cost of capital of 10%? (Hint: Note that B is a 6-year project.) Round your answers to two decimal places. Project A % Project B % What is each project's MIRR at a cost of capital of 18%? (Hint: Note that B is a 6-year project.) Round your answer to two decimal places. Project A % Project B %
2. What is the crossover rate? Round your answer to two decimal places. %

Answer rating: 100% (QA)

To calculate the Modified Internal Rate of Return MIRR for each project at different cost of capital rates we can use the following steps 1 Calculate ... View the full answer