1. Use the following information to answer the next six questions.

   You are evaluating independent projects with cash flows shown below. The WACC is 12%.

   Year	Cash Flows: Project A (in millions)	Cash Flows: Project B (in millions)
   0	-125	-140
   1	40	85
   2	30	50
   3	85	-20
   4	-10	-15
   5	70	90

   You are concerned about short-term financing, so you decide to evaluate each project in terms of its payback period. Your required payback period is 4 years. Which project or projects would you take?

   		A
   		B
   		A&B
   		You'd be indifferent between accepting and rejecting either project.
   		None of the above

1. Find the discounted payback period (in years) for project B. Round intermediate steps and your final answer to four decimals. Do not use words when entering your response.

1. Suppose you decide to the discounted payback method to evaluate the projects, with a required payback of 4 years. Which project or projects would you accept?

   		A
   		B
   		A&B
   		You'd be indifferent between accepting and rejecting either project
   		None of the above

1. Which project or projects would you take based on NPV?

   		A
   		B
   		A&B
   		You'd be indifferent between accepting and rejecting either project
   		None of the above

1. What is the modified internal rate of return for project A? Round intermediate steps to four decimals.

   		.2059
   		.1241
   		.238
   		.1978
   		None of the above

1. Which project or projects would you take based on MIRR?

   		A
   		B
   		A&B
   		You'd be indifferent between accepting and rejecting either project
   		None of the above