The following information about two mutually exclusive projects M and N are relevant for requirements (a) to (c) only. Max-V Company is considering investing in project-M, which will require an outlay of $450 million. The project will have a four-year life and at the end of that time, the equipment will be scrapped.

The project is expected to generate the following annual cash flows:

	Year-1	Year-2	Year-3	Year-4
Cash inflows	$430m	$330m	$350m	$290m
Cash outflows	$220m	$150m	$170m	$155m

The company has a required rate of return of 10.15%. The company normally has two-year payback criteria.

The alternative project-N offers the following net cash flows:

Year-0 ($450m); Year-1 $129m; Year-2 $158m; Year-3 $221m and Year-4 $250m.

(a) Calculate the (i) NPV, (ii) IRR, (iii) PVI, (iv) Payback period, (v) Discounted payback period for projects M and N.

(b) Calculate the crossover rate (between projects M and N) based on the cash flow data mentioned above. Show the range of required rates for which either project-M or project-N would be preferred.

(c) Based on your findings in requirements a and b above, what would be the decision of selection of project (when the required rate of return is 10.15 percent)?