Computation of net present value and cost and cash flows

Reference no: EM1314166

Computation of Net present value

Draconian Measures, Inc., is evaluating two independent projects. The company uses a 13.8ercent discount rate for such projects. Cost and Cash flows are shown in the table. What are the NPVs of the two projects?

*Year*	*Cash flows*
*Year*	*Project 1*	*Project 2*
0	$ (8,425,375)	$ (11,368,000)
1	$ 3,225,997	$ 2,112,589
2	$ 1,775,882	$ 3,787,552
3	$ 1,375,112	$ 3,125,650
4	$ 1,176,558	$ 4,115,899
5	$ 1,212,645	$ 4,556,424
6	$ 1,582,156
7	$ 1,365,882

Reference no: EM1314166

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