Your division is considering two investment projects, each of which requires an up-front expenditure of $22 million. You estimate that the cost of capital is 10% and that the investments will produce the following after-tax cash flows

Year Project A Project B

1 5 20

2 10 10

3 15 8

4 20 6

a. What is the regular payback period for each of the projects? Round your answers to two decimal places.

Project A years Project B years

b. What is the discounted payback period for each of the projects? Round your answers to two decimal places.

Project A years Project B years

c. What is the crossover rate? Round your answer to two decimal places. (in %)

d. If the cost of capital is 10%, what is the modified IRR (MIRR) of each project? Round your answers to two decimal places.

Project A % Project B %