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NPV and IRR Analysis Cummings Products is considering two mutually exclusive investments whose expected net cash flows are as follows: The correct graph is -Select-graph Agraph Bgraph Cgraph DItem 1 . Project A: % Project B: % Calculate the two projects' NPVs, if each project's cost of capital were 11%. Do not round intermediate calculations. Round your answers to the nearest cent. Project A: $ Project B: $ Which project, if either, should be selected? -Select-Project AProject BItem 6 should be selected. Calculate the two projects' NPVs, if each project's cost of capital were 18%. Do not round intermediate calculations. Round your answers to the nearest cent. Project A: $ Project B: $ What would be the proper choice? -Select-Project AProject BItem 9 is the proper choice. Project A: % Project B: % What is each project's MIRR at a cost of capital of 18%? (Hint: Consider Period 7 as the end of Project B's life.) Do not round intermediate calculations. Round your answers to two decimal places. Project A: % Project B: % % What is its significance? I. If the cost of capital is less than the crossover rate, both the NPV and IRR methods lead to the same project selections. II. The crossover rate has no significance in capital budgeting analysis. III. If the cost of capital is greater than the crossover rate, both the NPV and IRR methods will lead to the same project selection. -Select-IIIIIIItem 15 Check My Work (1 remaining) NPV and IRR Analysis Cummings Products is considering two mutually exclusive investments whose expected net cash flows are as follows: Expected Net Cash FlowsYearProject AProject B0-$340-$6301-5282102-2192103- 15021041,100210582021069902107-325210 Select the correct graph for NPV profiles for Projects A and B. The correct graph is -Select-graph Agraph Bgraph Cgraph DItem 1 . What is each project's IRR? Do not round intermediate calculations. Round your answers to two decimal places. Project A: % Project B: % Calculate the two projects' NPVs, if each project's cost of capital were 11%. Do not round intermediate calculations. Round your answers to the nearest cent. Project A: $ Project B: $ Which project, if either, should be selected? -Select-Project AProject BItem 6 should be selected. Calculate the two projects' NPVs, if each project's cost of capital were 18%. Do not round intermediate calculations. Round your answers to the nearest cent. Project A: $ Project B: $ What would be the proper choice? -Select-Project AProject BItem 9 is the proper choice. What is each project's MIRR at a cost of capital of 11%? (Hint: Consider Period 7 as the end of Project B's life.) Do not round intermediate calculations. Round your answers to two decimal places. Project A: % Project B: % What is each project's MIRR at a cost of capital of 18%? (Hint: Consider Period 7 as the end of Project B's life.) Do not round intermediate calculations. Round your answers to two decimal places. Project A: % Project B: % What is the crossover rate? Do not roun.

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-Select-IIIIIIItem 15
Check My Work (1 remaining)
NPV and IRR Analysis
Cummings Products is considering two mutually exclusive investments whose expected net cash
flows are as follows:
Expected Net Cash FlowsYearProject AProject B0-$340-$6301-5282102-2192103-
15021041,100210582021069902107-325210
Select the correct graph for NPV profiles for Projects A and B.
The correct graph is -Select-graph Agraph Bgraph Cgraph DItem 1 .
What is each project's IRR? Do not round intermediate calculations. Round your answers to two
decimal places.
Project A: %
Project B: %
Calculate the two projects' NPVs, if each project's cost of capital were 11%. Do not round
intermediate calculations. Round your answers to the nearest cent.
Project A: $
Project B: $
Which project, if either, should be selected?
-Select-Project AProject BItem 6 should be selected.
Calculate the two projects' NPVs, if each project's cost of capital were 18%. Do not round
intermediate calculations. Round your answers to the nearest cent.
Project A: $
Project B: $
What would be the proper choice?
-Select-Project AProject BItem 9 is the proper choice.
What is each project's MIRR at a cost of capital of 11%? (Hint: Consider Period 7 as the end of
Project B's life.) Do not round intermediate calculations. Round your answers to two decimal
places.

Project A: %
Project B: %
What is each project's MIRR at a cost of capital of 18%? (Hint: Consider Period 7 as the end of
Project B's life.) Do not round intermediate calculations. Round your answers to two decimal
places.
Project A: %
Project B: %
What is the crossover rate? Do not round intermediate calculations. Round your answer to two
decimal places.
%
What is its significance?
I. If the cost of capital is less than the crossover rate, both the NPV and IRR methods lead to the
same project selections.
II. The crossover rate has no significance in capital budgeting analysis.
III. If the cost of capital is greater than the crossover rate, both the NPV and IRR methods will
lead to the same project selection.
-Select-IIIIIIItem 15

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