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Only Info Provided NPV PROFILES: TIMING DIFFERENCES An oil-drilling company must choose between two mutually exclusive extraction projects, and each costs $12.2 million. Under Plan
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NPV PROFILES: TIMING DIFFERENCES An oil-drilling company must choose between two mutually exclusive extraction projects, and each costs $12.2 million. Under Plan A all the oil would be extracted in 1 year, producing a cash flow at t-1 of$14.64 million. Under plan B, cash flows would be $2.1678 million per year for 20 years. The firm's WACC is 11.7% a. Construct NPV profiles for Plans A and B. Round your answers to two decimal places. Do not round your intermediate calculations. Enter your answers in millions. For example, an answer of $10,550,000 should be entered as 10.55. If an year, producinga of $14.64 mil amount is zero enter "O". Negative value should be indicated by a minus sign NPV PlanA NPV Plan B Identify each project's IRR. Round your answers to two decimal places. Do not round your intermediate calculations Project A Project B Find the crossover rate. Round your answer to two decimal places. Do not round your intermediate calculations. calculationsStep by Step Solution
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