Question

Consider the following two mutually exclusive projects: Year Cash Flow (X) Cash Flow (Y)

0 –$ 23,000 –$ 23,000

1 10,490 12,000

2 10,900 9,360

3 10,500 10,400

Calculate the IRR for each project. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

What is the crossover rate for these two projects? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

What is the NPV of Projects X and Y at discount rates of 0%, 15%, and 25%? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)

Answer 1