Question: Consider the following two mutually exclusive projects, X and Y, and their cash flows information, Project Year 1 Year 2 Year 3 Year 4 Year

Consider the following two mutually exclusive projects, X and Y, and

Consider the following two mutually exclusive projects, X and Y, and their cash flows information, Project Year 1 Year 2 Year 3 Year 4 Year 0 (S1,400)S350 ($1,000 S300 $750 $400 $650 $500 S650 S600 (a) Assume that the discount rate is 12%, compute the payback period, the IRR, NPV (b) Use the McKinsey's approach to compute the Modified IRR (MIRR) for project X. (c) Apply the incremental IRR analysis to compute the crossover rate for projects X and Y and PI of project X. and select between these two mutually exclusive projects.

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