Your division is considering two projects with the following cash flows (in mill
ID: 2657998 • Letter: Y
Question
Your division is considering two projects with the following cash flows (in millions):
What are the projects' NPVs assuming the WACC is 5%? Round your answer to two decimal places. Do not round your intermediate calculations. Enter your answer in millions. For example, an answer of $10,550,000 should be entered as 10.55. Negative value should be indicated by a minus sign.
Project A $ million
Project B $ million
What are the projects' NPVs assuming the WACC is 10%? Round your answer to two decimal places. Do not round your intermediate calculations. Enter your answer in millions. For example, an answer of $10,550,000 should be entered as 10.55. Negative value should be indicated by a minus sign.
Project A $ million
Project B $ million
What are the projects' NPVs assuming the WACC is 15%? Round your answer to two decimal places. Do not round your intermediate calculations. Enter your answer in millions. For example, an answer of $10,550,000 should be entered as 10.55. Negative value should be indicated by a minus sign.
Project A $ million
Project B $ million
What are the projects' IRRs assuming the WACC is 5%? Round your answer to two decimal places. Do not round your intermediate calculations.
Project A %
Project B %
What are the projects' IRRs assuming the WACC is 10%? Round your answer to two decimal places. Do not round your intermediate calculations.
Project A %
Project B %
What are the projects' IRRs assuming the WACC is 15%? Round your answer to two decimal places. Do not round your intermediate calculations.
Project A %
Project B %
Explanation / Answer
What are the projects' NPVs assuming the WACC is 5%? Round your answer to two decimal places. Do not round your intermediate calculations. Enter your answer in millions. For example, an answer of $10,550,000 should be entered as 10.55. Negative value should be indicated by a minus sign.
Project A $ 16.91 million
Project B $ 5.92 million
What are the projects' NPVs assuming the WACC is 10%? Round your answer to two decimal places. Do not round your intermediate calculations. Enter your answer in millions. For example, an answer of $10,550,000 should be entered as 10.55. Negative value should be indicated by a minus sign.
Project A $ 13.44 million
Project B $ 4.12 million
What are the projects' NPVs assuming the WACC is 15%? Round your answer to two decimal places. Do not round your intermediate calculations. Enter your answer in millions. For example, an answer of $10,550,000 should be entered as 10.55. Negative value should be indicated by a minus sign.
Project A $ 10.48 million
Project B $ 2.56 million
Note: IRR is rate at which sum of present value of cash flows is equal to zero hence we will have only one IRR for each project hence changing WACC will make no difference.
What are the projects' IRRs assuming the WACC is 5%? Round your answer to two decimal places. Do not round your intermediate calculations.
Project A 42.04%
Project B 24.96%
What are the projects' IRRs assuming the WACC is 10%? Round your answer to two decimal places. Do not round your intermediate calculations.
Project A 42.04%
Project B 24.96%
What are the projects' IRRs assuming the WACC is 15%? Round your answer to two decimal places. Do not round your intermediate calculations.
Project A 42.04%
Project B 24.96%
NPV working
Rate = 5%
Rate = 10%
Rate = 15%
Rate = 5%
Rate = 10%
Rate = 15%
Year
Project A
Project B
Discounted Cash flow
Discounted Cash flow
Discounted Cash flow
Discounted Cash flow
Discounted Cash flow
Discounted Cash flow
Cfa
CFb
=Cfa/(1+Rate)^Y
=Cfa/(1+Rate)^Y
=Cfa/(1+Rate)^Y
=Cfb/(1+Rate)^Y
=Cfb/(1+Rate)^Y
=Cfb/(1+Rate)^Y
0
-19.00
-17.00
-19.000000
-19.000000
-19.000000
-17.000000
-17.000000
-17.000000
1
8.00
11.00
7.619048
7.272727
6.956522
10.476190
10.000000
9.565217
2
15.00
8.00
13.605442
12.396694
11.342155
7.256236
6.611570
6.049149
3
17.00
6.00
14.685239
12.772352
11.177776
5.183026
4.507889
3.945097
Total = NPV =
16.91
13.44
10.48
5.92
4.12
2.56
IRR working
Rate = 42.04%
Rate = 24.96%
Year
Project A
Project B
Discounted Cash flow
Discounted Cash flow
Cfa
CFb
=Cfa/(1+Rate)^Y
=Cfa/(1+Rate)^Y
0
-19.00
-17.00
-19.000000
-17.000000
1
8.00
11.00
5.632328
8.802491
2
15.00
8.00
7.435105
5.122899
3
17.00
6.00
5.932567
3.074610
Total = NPV =
0.00
0.00
Rate = 5%
Rate = 10%
Rate = 15%
Rate = 5%
Rate = 10%
Rate = 15%
Year
Project A
Project B
Discounted Cash flow
Discounted Cash flow
Discounted Cash flow
Discounted Cash flow
Discounted Cash flow
Discounted Cash flow
Cfa
CFb
=Cfa/(1+Rate)^Y
=Cfa/(1+Rate)^Y
=Cfa/(1+Rate)^Y
=Cfb/(1+Rate)^Y
=Cfb/(1+Rate)^Y
=Cfb/(1+Rate)^Y
0
-19.00
-17.00
-19.000000
-19.000000
-19.000000
-17.000000
-17.000000
-17.000000
1
8.00
11.00
7.619048
7.272727
6.956522
10.476190
10.000000
9.565217
2
15.00
8.00
13.605442
12.396694
11.342155
7.256236
6.611570
6.049149
3
17.00
6.00
14.685239
12.772352
11.177776
5.183026
4.507889
3.945097
Total = NPV =
16.91
13.44
10.48
5.92
4.12
2.56
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.