PLEASE ANSWER ALL

1)

A firm is considering two mutually exclusive projects, X and Y, with the following cash flows:

0

1

2

3

4

Project X	-$1,000	$90	$300	$430	$750
Project Y	-$1,000	$900	$110	$55	$50

The projects are equally risky, and their WACC is 11%. What is the MIRR of the project that maximizes shareholder value? Do not round intermediate calculations. Round your answer to two decimal places.

2)

A company is considering two mutually exclusive expansion plans. Plan A requires a $39 million expenditure on a large-scale integrated plant that would provide expected cash flows of $6.23 million per year for 20 years. Plan B requires a $11 million expenditure to build a somewhat less efficient, more labor-intensive plant with an expected cash flow of $2.47 million per year for 20 years. The firm's WACC is 11%.

1. Calculate each project's NPV. Enter your answers in millions. For example, an answer of $10,550,000 should be entered as 10.55. Do not round intermediate calculations. Round your answers to two decimal places.

   Plan A: $ million

   Plan B: $ million

   Calculate each project's IRR. Round your answers to one decimal place.

   Plan A: %

   Plan B: %

2. By graphing the NPV profiles for Plan A and Plan B, determine the crossover rate. Round your answer to one decimal place.

   %

3. Calculate the crossover rate where the two projects' NPVs are equal. Round your answer to one decimal place.

   %

4. Is NPV better than IRR for making capital budgeting decisions that add to shareholder value?