Question: Below are the estimated cash flows for two mutually exclusive projects for a company. Year 0 Cash flows in KS Project A Project B Cash


Below are the estimated cash flows for two mutually exclusive projects for a company. Year 0 Cash flows in KS Project A Project B Cash flows Cash flows $ (15,500.00 $ (15,500,00) $ 9,000.00 $ 1,500.00 $ 3,000.00 $ 2,000.00 $ 1,500.00 $ 3,000.00 $ 2,100.00 $ 4,000.00 $ 2,000.00 $ 9,000.00 1 2. 3 4 5 Which of the following statements are true about the projects in part 3 of the information provided at a WACC of 5%? A. The NPV indicates that Project B is better, but IRR suggests Project A is better. OB. Both the NPV and the IRR indicate that Project A is better. OC. The NPV indicates that Project A is better, but IRR suggests Project B is better. OD. Both the NPV indicate and the IRR indicate that Project B is better. QUESTION 26 Which of the following statements are true about the projects in part 3 of the information provided at a WACC of 6.25%? O A. The NPV indicates that Project B is better, but IRR suggests Project A is better. O B. Both the NPV and the IRR indicate that Project A is better. OC. The NPV indicates that Project A is better, but IRR suggests Project B is better OD. Both the NPV and the IRR indicate that Project B is better. QUESTION 27 in Part 3, the mutually exclusive projects DO NOT have a conflict between NPV and IRR if the WACC is 6.25% True False What is the crossover rate for the mutually exclusive projects in Part 3? O A.4.9612% OB.5.1356% O C.6.1168% O D.There is not one, Project A dominates QUESTION 29 If the WACC changes, the crossover rate will change as well. True O False
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