Question 7 1 pts Which of the following statements is correct? When evaluating mutually exclusive projects, the modified IRR (MIRR) always leads to the same capital budgeting decisions as the NPV method, regardless of the relative lives or sizes of the projects being evaluated. An increase in the firm's WACC will decrease projects' NPVs, which could change the accept/reject decision for any potential project. However, such a change would have no impact on projects' IRRs. Therefore, the accept/reject decision under the IRR method is independent of the cost of capital. One advantage of the payback method for evaluating potential investments is that it provides information about a project's liquidity and risk. The regular payback method is deficient in that it does not take account of cash flows beyond the payback period. The discounted payback method corrects this fault. The NPV and IRR methods, when used to evaluate two independent and equally risky projects, will lead to different accept/reject decisions and thus capital budgets if the projects' IRRs are greater than their cost of capital. Question 8 1 pts Project X's IRR is 19% and Project Y's IRR is 17%. The projects have the same risk and the same lives, and each has constant cash flows during each year of their lives. If the WACC is 10%, Project Y has a higher NPV than X. Given this information, which of the following statements is correct? If the WACC is 8%, Project X will have the higher NPV. The crossover rate must be greater than 10%. If the WACC is 18%, Project Y will have the higher NPV. The crossover rate must be less than 10%. O Project X is larger in the sense that it has the higher initial cost