ter $9$

Question $7,$ P$9-16$

$($similar to$)$

HW Score: $54\mathrm{.}32\%,4\mathrm{.}89$

Part $1$ of $7$

of $9$ points

Points: $0$ of $1$

MIRR unequal lives. Singing Fish Fine Foods has $$1,820,000$ for capital investments this year and is considering two potential projects for the funds. Project $1$ is updating the store's deli section for additional food service. The estimated afier$-$tax cash flow of this project is $$610,000$ per year for the next five years. Project $2$ is updating the store's wine section. The estimated annual after$-$tax cash flow for this project is $$520,000$ for the next six years. The appropriate discount rate for the deli expansion is $9\mathrm{.}6\%$ and the appropriate discount rate for the wine section is $9\mathrm{.}2\%.$ What are the MIRRs for the Singing Fish Fine Foods projects? What are the MIRRs when you adjust for urequal lives? Do the MIRR adjusted for unequal lives change the decision based on MIRRs? Hint: Take all cash flows to the same ending period as the longest project.

If the appropriate reinvestment rate for the deli expansion is $9\mathrm{.}6\%,$ what is the MIRR of the deli expansion?

$\%($Round to two decimal places.$)$