XYZ Ltd. is evaluating two potential projects, Project X and Project Y. The expected net cash flows for both projects over five years are given below:

Projected Net Cash Flows (in thousands of dollars)

Year 0:

• Project X: $(250)$
• Project Y: $(300)$

Year 1:

• Project X: $80$
• Project Y: $100$

Year 2:

• Project X: $100$
• Project Y: $120$

Year 3:

• Project X: $120$
• Project Y: $150$

Year 4:

• Project X: $150$
• Project Y: $180$

Year 5:

• Project X: $180$
• Project Y: $200$

Requirements:

1. Calculate the Net Present Value (NPV) for each project using a discount rate of $8%$.
2. Determine the Internal Rate of Return (IRR) for each project.
3. Compute the Modified Internal Rate of Return (MIRR) for each project, assuming a reinvestment rate of $8%$.
4. Find the payback period for each project.
5. Discuss the sensitivity of each project to changes in the discount rate.