In: Finance
Consider the following two mutually exclusive projects:
Year |
Cash Flow (X) |
Cash Flow (Y) |
0 |
-$23,400 |
-$23,400 |
1 |
$13,100 |
$9,200 |
2 |
$9,480 |
$10,620 |
3 |
$7,890 |
$11,180 |
Sketch the NPV profiles for X and Y over a range of discount rates from 0 to 25 percent. What is the crossover rate for these two projects?