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Note: For Problems 16 through 23 use the data provided in Table 1 Table 1: Cash Flow Summary Year Project A Project B 0 30000 30000 1 15000 12500 2

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Note: For Problems 16 through 23 use the data provided in Table 1 Table 1: Cash Flow Summary Year Project A Project B 0 -30000 -30000 1 15000 12500 2 15000 10000 3 10000 15000 4 10000 15000 16. If Company XYZ has a WACC of 7% and the two projects are independent, which project would you accept based upon NPV rules? 17. If Company XYZ has a WACC of 26% and the two projects are mutually exclusive which project would you accept based upon NPV rules? 18. What is the Internal Rate of Return for Project A? 19. What is the Profitability Index for Project B? 20. What is the Discounted Profitability Index for Project A (WACC: 8%)? 21. What is the Payback Period for Project B? 22. What is the Discounted Payback Period for Project A (WACC: 8%)? 23. What is the Crossover Rate for Project’s A and B?
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16. If Company XYZ has a WACC of 7% and the two projects are independent, which project would you accept based upon... View the full answer

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