Question 24 (3 points)

Your company is considering two mutually exclusive projects, X and Y whose costs and cash flows are shown below. Assume that the projects are equally risky, and their cost of capital is 12%.

Year	Project X	Project Y
0	$(5,500)	$(5,500)
1	1,000	4,500
2	1,500	1,500
3	2,000	1,000
4	4,500	800

What are MIRRs of Project X and Project Y? Which project you will accept based on MIRR project selection criterion, if projects are mutually exclusive?

Question 24 options:

	MIRRx = 16.20%; MIRRy = 16.48%; accept Project X
	MIRRx = 17.80%; MIRRy = 17.30%; accept Project X
	MIRRx=17.49%; MIRRy=18.39%; accept Project Y
	MIRRx = 16.46%; MIRRy = 16.02%; accept Project X

Question 25 (1 point)

Although depreciation is indeed a noncash item in the balance sheet of a company, it is tax deductible.

Question 25 options:

	True
	False