Question: 11-6. NPV: Your division is considering two projects with the following cash flows (in millions) 0___________1__________2__________3 Project A -$25 $5 $10 $17 Project B -$20

11-6. NPV: Your division is considering two projects with the following cash flows (in millions)

0___________1__________2__________3

Project A -$25 $5 $10 $17

Project B -$20 $10 $9 $6

  1. What is the project's NPVs assuming the WACC is 5%? 10%? 15%
  2. What are the project's IRRs at each of these WACCs?
  3. If the WACC was 5% and A and B were mutually exclusive, which project would you choose? What is the WACC was 10% 15% (Hint: The crossover rate is 7.81%)

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