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