6.  Problem 11.06 (NPV) Your division is considering two projects with the following cash flows (in millions): 0 1 2 3 Project A -$20 $5 $9 $12 Project...

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Finance

6.  Problem 11.06 (NPV)

Your division is considering two projects with the followingcash flows (in millions):

0123
Project A-$20$5$9$12
Project B-$13$8$7$3
  1. What are the projects' NPVs assuming the WACC is 5%? Enter youranswer in millions. For example, an answer of $10,550,000 should beentered as 10.55. Negative values, if any, should be indicated by aminus sign. Do not round intermediate calculations. Round youranswer to two decimal places.
    Project A:    $   million
    Project B:    $   million

    What are the projects' NPVs assuming the WACC is 10%? Enter youranswer in millions. For example, an answer of $10,550,000 should beentered as 10.55. Negative values, if any, should be indicated by aminus sign. Do not round intermediate calculations. Round youranswer to two decimal places.
    Project A:  $   million
    Project B:  $   million

    What are the projects' NPVs assuming the WACC is 15%? Enter youranswer in millions. For example, an answer of $10,550,000 should beentered as 10.55. Negative values, if any, should be indicated by aminus sign. Do not round intermediate calculations. Round youranswer to two decimal places.
    Project A:  $   million
    Project B:  $   million

  2. What are the projects' IRRs assuming the WACC is 5%? Do notround intermediate calculations. Round your answer to two decimalplaces.
    Project A:    %
    Project B:    %

    What are the projects' IRRs assuming the WACC is 10%? Do notround intermediate calculations. Round your answer to two decimalplaces.
    Project A:    %
    Project B:    %

    What are the projects' IRRs assuming the WACC is 15%? Do notround intermediate calculations. Round your answer to two decimalplaces.
    Project A:    %
    Project B:    %

  3. If the WACC was 5% and A and B were mutually exclusive, whichproject would you choose? (Hint: The crossover rate is3.86%.)
    -Select-- Project A, Project B, Neither A, nor B

  4. If the WACC was 10% and A and B were mutually exclusive, whichproject would you choose? (Hint: The crossover rate is3.86%.)
    -Select-Project A, Project B, Neither A, nor B

    If the WACC was 15% and A and B were mutually exclusive, whichproject would you choose? (Hint: The crossover rate is3.86%.)
    -Select-Project A, Project B, Neither A, nor B

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6.  Problem 11.06 (NPV)Your division is considering two projects with the followingcash flows (in millions):0123Project A-$20$5$9$12Project B-$13$8$7$3What are the projects' NPVs assuming the WACC is 5%? Enter youranswer in millions. For example, an answer of $10,550,000 should beentered as 10.55. Negative values, if any, should be indicated by aminus sign. Do not round intermediate calculations. Round youranswer to two decimal places.Project A:    $   millionProject B:    $   millionWhat are the projects' NPVs assuming the WACC is 10%? Enter youranswer in millions. For example, an answer of $10,550,000 should beentered as 10.55. Negative values, if any, should be indicated by aminus sign. Do not round intermediate calculations. Round youranswer to two decimal places.Project A:  $   millionProject B:  $   millionWhat are the projects' NPVs assuming the WACC is 15%? Enter youranswer in millions. For example, an answer of $10,550,000 should beentered as 10.55. Negative values, if any, should be indicated by aminus sign. Do not round intermediate calculations. Round youranswer to two decimal places.Project A:  $   millionProject B:  $   millionWhat are the projects' IRRs assuming the WACC is 5%? Do notround intermediate calculations. Round your answer to two decimalplaces.Project A:    %Project B:    %What are the projects' IRRs assuming the WACC is 10%? Do notround intermediate calculations. Round your answer to two decimalplaces.Project A:    %Project B:    %What are the projects' IRRs assuming the WACC is 15%? Do notround intermediate calculations. Round your answer to two decimalplaces.Project A:    %Project B:    %If the WACC was 5% and A and B were mutually exclusive, whichproject would you choose? (Hint: The crossover rate is3.86%.)-Select-- Project A, Project B, Neither A, nor BIf the WACC was 10% and A and B were mutually exclusive, whichproject would you choose? (Hint: The crossover rate is3.86%.)-Select-Project A, Project B, Neither A, nor BIf the WACC was 15% and A and B were mutually exclusive, whichproject would you choose? (Hint: The crossover rate is3.86%.)-Select-Project A, Project B, Neither A, nor B

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