Question: Cummings Products is considering two mutually exclusive investments whose expected net cash flows are as follows: Year Project A Project B 0 $400 $650 1

Cummings Products is considering two mutually exclusive investments whose expected

net cash flows are as follows:

Year	Project A	Project B
0	$400	$650
1	528	210
2	219	210
3	150	210
4	1,100	210
5	820	210
6	990	210
7	325	210

a. Construct NPV profiles for Projects A and B.

b. What is each projects IRR?

c. If each projects cost of capital were 10%, which project, if either, should be selected?

If the cost of capital were 17%, what would be the proper choice?

d. What is each projects MIRR at the cost of capital of 10%? At 17%? (Hint: Consider

Period 7 as the end of Project Bs life.)

e. What is the crossover rate, and what is its significance?

PLEASE HELP & please show work on how to get each answer. If using excel, please show formulas used. I am stuck and must learn how to do problems of this nature for my final. THANK YOU!!!

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