Question: Your division is considering projects S and L. Project S and L require up-front expenditures of $2,050 and $4,300, respectively. You estimate that the cost

Your division is considering projects S and L. Project S and L require up-front expenditures of $2,050 and $4,300, respectively. You estimate that the cost of capital is 10.25% and that the investments will produce the following after-tax cash flows:

Year	Project-S	Project-L
1	$750	$1,500
2	$760	$1,518
3	$770	$1,536
4	$780	$1,554

What is the regular payback period for project L?

What is the discounted payback period for project S?

What is the IRR for project L?

What is the NPV for project S?

What is the profitability index for project L?

If both projects (S and L) are mutually exclusive, based on IRR, which project or projects should the firm undertake?

What is the crossover rate?

What is the modified IRR (MIRR) of project S?

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