You are analysing the following investment projects. Both projects have a 10% discount rate.

The proposed Project A will cost $500,000. Cash inflows are projected to be: year 1 = $50,000, year 2 = $120,000; year 3 = $90,000; year 4 = $180,000; year 5 = $110,000.

The other proposed Project B will cost $400,000.Cash inflows are projected to be: year 1 = $60,000, year 2 = $70,000; year 3 = $80,000; year 4 = $90,000; year 5 = $100,000.

REQUIRED:

(i) Calculate the crossover rate.