You've estimated the following cash flows (in $ million) for two mutually exclusive projects: Year Project A Project B 0 -27 -43 1 30 45 2 40 50   What is the crossover rate, i.e., the discount rate at which both projects have the same NPV? What is project A's NPV at the crossover rate? What is project B's NPV at the crossover rate?

Managerial Economics: A Problem Solving Approach
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Chapter5: Investment Decisions: Look Ahead And Reason Back
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You've estimated the following cash flows (in $ million) for two mutually exclusive projects:

Year Project A Project B
0 -27 -43
1 30 45
2 40 50

 

What is the crossover rate, i.e., the discount rate at which both projects have the same NPV?

What is project A's NPV at the crossover rate?

What is project B's NPV at the crossover rate?

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