(11-DE)

EXPECTED NET CASH FLOWS
Year	Project A	Project B
0	-$300	-$405
1	-387	134
2	-193	134
3	-100	134
4	600	134
5	600	134
6	850	134
7	-180	134

D.What is each project's MIRR at a cost of capital of 17%? (Hint: Note that B is a 6-year project.) Round your answer to two decimal places. Project A % Project B %

E.What is the crossover rate? Round your answer to two decimal places. What is its significance? Select one below

I.If the cost of capital is less than the crossover rate, both the NPV and IRR methods lead to the same project selections. II.The crossover rate has no significance in capital budgeting analysis. III.If the cost of capital is greater than the crossover rate, both the NPV and IRR methods will lead to the same project selection.