A company has a 13% WACC and is considering two mutually exclusive investments (that cannot be repeated) with the following cash flows: Project A Project B X -$300 -$405 $134 0 Project A: $ Project B: $ 1 Project B: Project A: -$387 -$193 Project B: The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below. 2 % Open spreadsheet a. What is each project's NPV? Round your answer to the nearest cent. Do not round your intermediate calculations. % 3 b. What is each project's IRR? Round your answer to two decimal places. Project A: 4 % 5 % 6 $600 -$100 $600 $134 $134 $134 $134 $134 $850 7 c. What is each project's MIRR? (Hint: Consider Period 7 as the end of Project B's life.) Round your answer to two decimal places. Do not round your intermediate calculations. -$180 $0

A company has a 13% WACC and is considering two mutually exclusive investments (that cannot be repeated) with the following cash flows: Project A Project B X -$300 -$405 $134 0 Project A: $ Project B: $ 1 Project B: Project A: -$387 -$193 Project B: The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below. 2 % Open spreadsheet a. What is each project's NPV? Round your answer to the nearest cent. Do not round your intermediate calculations. % 3 b. What is each project's IRR? Round your answer to two decimal places. Project A: 4 % 5 % 6 $600 -$100 $600 $134 $134 $134 $134 $134 $850 7 c. What is each project's MIRR? (Hint: Consider Period 7 as the end of Project B's life.) Round your answer to two decimal places. Do not round your intermediate calculations. -$180 $0

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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