The management of Advanced Alternative Power Inc. is considering two capital investment projects. The estimated net cash flows from each project are as follows: Year Wind Turbines Biofuel Equipment 1 $430,000 $860,000 2 430,000 860,000 3 430,000 860,000 4 430,000 860,000 2. Determine the internal rate of return for each project by (a) computing a present value factor for an annuity of $1 and (b) using the present value of an annuity of $1 in the table above. If required, round your present value factor answers to three decimal places and internal rate of return to the nearest whole percent. Line-Item Description Biofuel Equipment fill in the blank 10 Present value factor for an annuity of $1 Wind Turbines fill in the blank 9 Internal rate of return fill in the blank 11 % fill in the blank 12 % The wind turbines require an investment of $1,113,270, while the biofuel equipment requires an investment of $2,455,300. No residual value is expected from either project. Present Value of an Annuity of $1 at Compound Interest 3. The net present value, present value index, and internal rate of return all indicate that the biofuel equipment wind turbines is/are a better financial opportunity compared to the biofuel equipment wind turbines, although both investments meet the minimum return criterion of 10%. Year 6% 10% 12% 15% 20% 1 0.943 0.909 0.893 0.870 0.833 2 1.833 1.736 1.690 1.626 1.528 3 2.673 2.487 2.402 2.283 2.106 4 3.465 3.170 3.037 2.855 2.589 5 4.212 3.791 3.605 3.353 2.991 6 4.917 4.355 4.111 3.785 3.326 7 5.582 4.868 4.564 4.160 3.605 8 6.210 5.335 4.968 4.487 3.837 9 6.802 5.759 5.328 4.772 4.031 10 7.360 6.145 5.650 5.019 4.192 Required: 1a. Compute the net present value for each project. Use a rate of 10% and the present value of an annuity of $1 in the table above. If required, use the minus sign to indicate a negative net present value. If required, round to the nearest whole dollar. Biofuel Equipment Line Item Description Wind Turbines $ $ Present value of annual net cash flows fill in the blank 1 fill in the blank 2 Amount to be invested fill in the blank 3 fill in the blank 4 $ $ fill in the blank 5 fill in the blank 6 Net present value 1b. Compute a present value index for each project. If required, round your answers to two decimal places. Project Present Value Index Wind Turbines Biofuel Equipment fill in the blank 7 fill in the blank 8