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Posted: **Mon May 02, 2022 9:06 am**

: Big Company Is Evaluating Two Projects Project A And Project B Both Projects Are Of Equal Risk Big Company Has A Wacc 1 (28.8 KiB) Viewed 48 times

: Big Company Is Evaluating Two Projects Project A And Project B Both Projects Are Of Equal Risk Big Company Has A Wacc 2 (12.06 KiB) Viewed 48 times

: Big Company Is Evaluating Two Projects Project A And Project B Both Projects Are Of Equal Risk Big Company Has A Wacc 3 (11.18 KiB) Viewed 48 times

Big Company is evaluating two projects, Project A and Project B. Both projects are of equal risk. Big Company has a WACC of 10%. The expected Free Cash Flows of the projects are as follows: Period Annual Cash Flows Project "A" Annual Cash Flows Project "B" 0 1 2 W N ($30,000) 6,500 9.000 12,000 15,000 ($30,000) 16,500 10,500 9,000 3,000 3 4 Compute the Modified Internal Rate of Return (MIRR) for "A". Show your inputs/work for partial credit.
The Modified Internal Rate of Return of Project "B" is 12.21%. If Projects "A" and "B" are independent, considering only the MIRR method, which project(s) should Big Company proceed with? Explain your answer.
The Modified Internal Rate of Return of Project "B" is 12.21%. If Projects "A" and "B" are mutually exclusive, considering only the MIRR method, which project(s) should Big Company proceed with? Explain your answer.