12. Problem 11.19 Click here to read the eBoak: Multiple Internal Rates af Return Click here to read the eBook: Modified Internal Rate or Return (MIRR) MULTIPLE IRRS AND MIRR Amining company is deciding whether to open a strip mine, which costs $2 million. Cash inflows of $12.5 million would occur at the end of Year 1. The land must be returned to its natural state at a cost of $11.5 million, payable at the end of Year 2. a. Plot the praject's NPV profile A B C D NV Milion al Dole NPV Mlon of Doilla) NPV Mlon of Dolla) NPV Million of Dela 3 2.5 1.5 2.5 0.5 0.5 0.5 -0.5 -0.5 0.5 -0.5 100 200 300 400 WACC) 300 ) 400 WACC) de 3d 3d 300 400 WACC%) do 20 de 300 40C WACC) The correct sketch is Salut b. Should the project be accepted if WAOC = 10%? -Select- Should the praject be accepted if WACC -20%? -Select- c. Think of some other capital budgeting situations in which negative cash flows during or at the end of the project's life might lead to multiple IRRs. The input in the box below will not be graded, but may be reviewed and considered by your Instructor d. What is the project's MIRR aL WACC = 10%? Round your answer to two decimal places. Do not round your intermediale calculations. 9 What is the project's MIRR at WACC -20%? Round your answer to two decimal places. Do not round your intermediate calculations. 95 Does MIRR lead to the same accept/reject decision for this project as the NPV method? -Select- Does the MERR method always lead to the same accept/reject decision as NPV? (Hint: Consider mutually exclusive projects that differ in size. Select