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/hat are the projects' NPVS assuming the WACC is 5%? En ot round intermediate calculations. Round your answer to

/hat are the projects' NPVS assuming the WACC is 5%? En ot round intermediate calculations. Round your answer to

Essentials Of Investments
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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Part B
Your division is considering two projects with the following cash flows (in millions): 2 3 Project -$31 $7 $12 $22 A Project -$19 $13 $6 $5 B a. What are the projects' NPVS assuming the WACC is 5%? Enter your answer in millions. For example, an answer of $10,550,000 should be entered as 10.55. Negative values, if any, should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to two decimal places. Project A: $ 5.56 O million Project B: $ 3.14 What are the projects' NPVS assuming the WACC is 10%? Enter your answer in millions. For example, an answer of $10,550,000 should be entered as 10.55. Negative values, if any, should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to two decimal places. Project A: $ 1.81 O million Project B: $ 1.53 O million What are the projects' NPVS assuming the WACC is 15%? Enter your answer in millions. For example, an answer of $10,550,000 should be entered as 10.55. Negative values, if any, should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to two decimal places. Project A: $ -1.3: O million Project B: $ 0.13 O million b. What are the projects' IRRS assuming the WACC is 5%? Do not round intermediate calculations. Round your answer to two decimal places. Project A: Project B: 10 0 % What are the projects' IRRS assuming the WACC is 10%? Do not round intermediate calculations. Round your answer to two decimal places. Project A: Project B: 5 What are the projects' IRRS assuming the WACC is 15%? Do not round intermediate calculations. Round your answer to two decimal places. Project A: -2 0 % Project B: c. If the WACC was 5% and A and B were mutually exclusive, which project would you choose? (Hint: The crossover rate is 10.72%.) Project A If the WACC was 10% and A and B were mutually exclusive, which project would you choose? (Hint: The crossover rate is 10.72%.) Project A If the WACC was 15% and A and B were mutually exclusive, which project would you choose? (Hint: The crossover rate is 10.72%.) Project B
Transcribed Image Text:Your division is considering two projects with the following cash flows (in millions): 2 3 Project -$31 $7 $12 $22 A Project -$19 $13 $6 $5 B a. What are the projects' NPVS assuming the WACC is 5%? Enter your answer in millions. For example, an answer of $10,550,000 should be entered as 10.55. Negative values, if any, should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to two decimal places. Project A: $ 5.56 O million Project B: $ 3.14 What are the projects' NPVS assuming the WACC is 10%? Enter your answer in millions. For example, an answer of $10,550,000 should be entered as 10.55. Negative values, if any, should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to two decimal places. Project A: $ 1.81 O million Project B: $ 1.53 O million What are the projects' NPVS assuming the WACC is 15%? Enter your answer in millions. For example, an answer of $10,550,000 should be entered as 10.55. Negative values, if any, should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to two decimal places. Project A: $ -1.3: O million Project B: $ 0.13 O million b. What are the projects' IRRS assuming the WACC is 5%? Do not round intermediate calculations. Round your answer to two decimal places. Project A: Project B: 10 0 % What are the projects' IRRS assuming the WACC is 10%? Do not round intermediate calculations. Round your answer to two decimal places. Project A: Project B: 5 What are the projects' IRRS assuming the WACC is 15%? Do not round intermediate calculations. Round your answer to two decimal places. Project A: -2 0 % Project B: c. If the WACC was 5% and A and B were mutually exclusive, which project would you choose? (Hint: The crossover rate is 10.72%.) Project A If the WACC was 10% and A and B were mutually exclusive, which project would you choose? (Hint: The crossover rate is 10.72%.) Project A If the WACC was 15% and A and B were mutually exclusive, which project would you choose? (Hint: The crossover rate is 10.72%.) Project B
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