Question
In: Finance
QUESTION 21 Bravossi Inc. has two projects with the following cash flows: Year Project 1 Project...
QUESTION 21
- Bravossi Inc. has two projects with the following cash flows:
|
Year |
Project 1 |
Project 2 |
|
0 |
(3,000.00) |
(2,400.00) |
|
1 |
1,000.00 |
1,500.00 |
|
2 |
?? |
800.00 |
|
3 |
1,500.00 |
?? |
|
4 |
1,800.00 |
1,400.00 |
|
IRR |
26.2307% |
33.8369% |
- What is the crossover rate?
|
a. |
8.4261% |
|
|
b. |
8.2041% |
|
|
c. |
7.6739% |
Solutions
Expert Solution
PV FACTOR SHORT CUT :
FOR 26.2307%
FIRST YEAR = 1/(1+0.262307) = 0.7922
SECOND YEAR = 1/(1+0.262307)^2 = 0.6276
SAME WAY FOR OTHER YEARS AND OTHER
PROJECT
jeff jeffy answered 2 years agoRelated Solutions
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