Question: I am needing help with the excel formulas for the following question (the cells highlighted in green.) Problem 1. West Coast Company is considering two
I am needing help with the excel formulas for the following question (the cells highlighted in green.)
| Problem 1. | West Coast Company is considering two mutually exclusive projects, the project's expected net cash flows are as follows: | |||||||
| Expected Cash Flows | ||||||||
| Year | Proj. A | Proj. B | ||||||
| 0 | ($40,000) | ($30,000) | ||||||
| 1 | ($12,000) | $8,500 | ||||||
| 2 | $10,000 | $8,500 | ||||||
| 3 | $35,000 | $8,500 | ||||||
| 4 | $14,000 | $8,500 | ||||||
| 5 | $25,000 | $8,500 | ||||||
| Required Rate of Return | 14.00% | 14.00% | ||||||
| 1.c. (8 points) | Calculate the crossover rate of these two projects. | |||||||
| Year | Proj. A | Proj. B | Cash Flow Difference between Proj. A & Proj. B | |||||
| 0 | ||||||||
| 1 | ||||||||
| 2 | ||||||||
| 3 | ||||||||
| 4 | ||||||||
| 5 | ||||||||
| Crossover rate | ||||||||
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