As the director of big sky corp you are evaluating two


As the director of Big Sky Corp, you are evaluating two mutually exclusive projects with the following net cash flow:

Year     Cash Flow X ($)            Cash Flow Y ($)

0          -100,000                       -100,000

1          60,000                          20,000

2          30,000                          20,000

3          30,000                          40,000

4          10,000                          60,000

5          10,000                          20,000

What is the discount payback for project Y if the interest rate is 10% per year?

4.26 years

3.86 years

4.16 years

2.36 years

What is the NPV for project Y if the discount rate is 10% per year?

$21,588.77

$21,624.87

$18,162.57

$21,323.67

What is the IRR for Project Y?

15.150%

It has no IRR

14.150%

16.150%

What is the crossover rate for the two projects?

13.81%

15.81%

12.81%

14.81%

The intercept on the x-axis for project Y is…?

16.15%

14.15%

15.15%

It does not intercept X-axis

PLEASE show your work

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Financial Management: As the director of big sky corp you are evaluating two
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