Homework Answers
rate positively .. formula in pic..
| Cross over rate is the rate at which both the project will have same NPv | |||||||
| Year | CFS | CFL | Delta (L-S) | ||||
| 0 | -1025 | -2150 | -1125 | ||||
| 1 | 380 | 755 | 375 | ||||
| 2 | 380 | 755 | 375 | ||||
| 3 | 380 | 755 | 375 | ||||
| 4 | 380 | 755 | 375 | ||||
| Cross over rate = | 12.59% | ||||||
| ans = | 12.59% | ||||||
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