4.

value: 10.00 points

Required information

What is the first step when calculating the crossover rate?

A. To calculate the IRR of the cash flow differences.

B. To compare the crossover rate to the Net Present Value.

C. To compare the crossover rate to the Internal Rate of Return.

D. To calculate the cash flow differences between each project.

E. To verify that you have at least five years of data for the calculation.

5.

value: 10.00 points

Required information

What is crossover rate?

A. The discount rate at which the project will become profitable.

B. The discount rate at which we are indifferent between two investments.

C. The discount rate that is higher than the Net Present Value.

D. The discount rate that ensures there will be payback for the project .

E. The discount rate that represents the highest possible project potential.

6.

value: 10.00 points

Required information

Based upon the following data: calculate the crossover rate.

	Project A			Project B
Year 0		-1,000			-1,200
Year 1		600			700
Year 2		650			800

rev: 02_19_2019_QC_CS-159344

A. 6.25%

B. 10.5%

C. 12.5%

D. 16.5%

E. 20.5%