Hanse, Inc., has the following two mutually exclusive projects available. Project R -$76,500 26,600 25,600 23,600 17,600 11,700 Project S -$97,200 24,300 24,300 39,300 34,300 13,300 Year a. What is the crossover rate for these two projects? (Do not round intermed O123¢5

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The profitability analysis of three projects is provided below: Project A Project B Project C NPV $10,000 $5,000 - $1,000 IRR 10% 15% 15% WACC 8% 12% 16% If these projects were independent, which project(s) would be accepted? Why? If these projects were mutually exclusive, which project(s) would be accepted? Why?

The Klingon Sausage Corporation is trying to choose between the following two projects: Year Cash Flow (Project I) Cash Flow (Project II) 0 -$363,000 -$165,000 1 184,800 99,600 2 184,800 99,600 3 184,800 99,600   The discount rate of both projects is 8%. Klingon’s manager believes the company has sufficient resources so that the two projects should not be treated as mutually exclusive. Which project should be taken based on the profitability index?   A. Project I should be accepted and project II should be rejected.   B. None of the projects should be accepted.   C. Project I should be rejected and project II should be accepted.   D. Both projects should be accepted.

The management of Bhytyu Limited are considering several mutually exclusive projects with characteristics as shown in the following table.  Project A B C D E  Initial Cost ($ millions) 87 121 91 95 118  Accounting rate of return 13% 13% 15% 22% 11%  Net Present Value ($ millions) 0 11 -1 7 10  Payback Period (Years) 3 5 7 3 5  Internal Rate of Return 9.5% 13.2% 8.0% 11.7% 12.5%   Management’s stated goal is to maximise the wealth of the firm’s owners, and to be accepted any investment project must have a minimum investment yield of 10%. Required: Which of the above projects, if any, should be selected by management? Explain the rationale for your choice.

Your company is considering two mutually exclusive projects, X and Y, whose costs and cash flows are shown here: \table[[Year,x,Y

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Projects Y and Z are mutually exclusive projects. Assume the company has a WACC of 14%. Year Project Y Project Z 0 -$1,500 -$1,500 1 200 900 2 400 600 3 600 300 4 1,000 200 What is the NPV of project Y?  What is the NPV of project Z? At what WACC should the company be indifferent whether to accept or reject project Z?

Consider the following two mutually exclusive projects:     Year Cash Flow(X)   Cash Flow(Y) 0 –$ 19,900     –$ 19,900   1   8,825       10,050   2   9,050       7,775   3   8,775       8,675       c) Calculate the crossover rate for these two projects. Consider the following two mutually exclusive projects:     Year Cash Flow(X)   Cash Flow(Y) 0 –$ 19,900     –$ 19,900   1   8,825       10,050   2   9,050       7,775   3   8,775       8,675     you have solved all other parts only balance Part C c) Calculate the crossover rate for these two projects.