Question

Please answer the e, f, g

Expert Q&A Done Excel Online Structured Activity: Capital budgeting criteria A company has a 12% WACC and is considering two mutually exclusive investments that cannot be repeated) with the following cash flows Project A -5300 5387 5193 $100 5600 5600 5850 -5180 Project B 5405 $132 $132 132 132 $132 5132 50 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 Open spreadsheet What is cach project's NPV? Round your answer to the nearest cent. Do not round a. your intermediate calculations Project AS Project B:S b. What is cach project's IRR? Round your answer to two decimal places. Project A: % Project B: % What is cach 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 C. calculations Project A: % Project B: % d. From your answers to parts ac, which project would be selected? Project AProject B If the WACC was 18%, which project would be selected? Project AProject B Construct NPV profiles for Projects A and B. Round your answers to the nearest cent. Do not round your intermediate calculations. Negative value should be indicated by a minus in NPV Project A NPV Project B Discount Rate 06 TT 18.1 23.33 Calculate the COSSOVET mate where the two projects NPVs are equal. Round your Banswer to two decimal places. Do not round your intermediate calculations What is cach project's MIRR at a WACC of 1896. Round your answer to two decimal h places. Do not found your intermediate callation Project A: % Project B:% Check My Work Reset Problem

Answer 1

B12 x fix =IRR(B3:310) A B C D Cash flows Year A B 2 3 4 5 6 7 8 9 10 0 $ 1 $ 2 $ 3 $ 4 $ 5 $ 6 $ 7 $ (300) $ (387) $ (193) $ (100) $ 600 $ 600 $ 850 $ (180) $ Difference (405) $ (105.00) 132 $ 519.00 132 $ 325.00 132 $ 232.00 132 $ (468.00) 132 $ (468.00) 132 $ (718.00) - $ 180.00 E F G H Discount rate NPV Project A NPV Project B 0.00% $ 890.00 $ 387.00 5.00% $ 540.09 $ 264.99 10.00% $ 283.34 $ 169.89 12.00% $ 200.41 $ 137.71 15.00% $ 92.96 $ 94.55 18.10% $ -0.09 $ 55.50 23.33% $ -124.29 $ 0.01 At 12%, Select Project A At 18%, Select Project B 12 IRR 18.10% 23.33% 14.92% Crossover Rate 15 NPV @ 12% $ $ 200.41 =NPV(12%,B4:B10)+B3 137.71 =NPV(12%,C4:C10)+C3 $ 18 NPV @18% 19 2.66 =NPV(18%,B4:B10)+B3 $ 56.68 ENPV(18%,C4:C10)+C3 20 15.10% 16.78% =MIRR(B3:B10,12%,12%) =MIRR(C3:C10,12%,12%) 21 MIRR at 12% 22 23 24 MIRR at 18% 25 18.05% 20.23% =MIRR(B3:B10,18%,18%) =MIRR(C3:C10,18%,18%)

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