Matterhorn Mountain Gear is evaluating two projects with the following cash flows: Year Project X Project...

Question

Question

Matterhorn Mountain Gear is evaluating two projects with the following cash flows:

Year Project X Project Y

0 −$317,400 −$295,550

1 147,100 137,800

2 164,600 155,000

3 129,700 120,750

What interest rate will make the NPV for the projects equal?

A)18.88%

B) .41%

C)11.80%

D)13.27%

E)19.30%

Answer 1

Answer #1

Year X O $(317,400.00) $ (295,550.00) $(21,850.00) 1147,100.00137,800.00$9,300.00 2 164,600.00 155,000.00 9,600.00 3129,700.0

Answer 2

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