Projects X and Y have the following expected net cash flows:

Year Project X Project Y

0 $-500,000 -$500,000

1 300,000 50,000

2 200,000 100,000

3 100,000 200,000

4 50,000 400,000

What is the crossover rate for Projects X and Y? (At what discount rate will the NPV of Project X equal the NPV of Project Y?)

		6.8 percent
		8.7 percent
		15.3 percent
		12.0 percent
		10.6 percent