Calculate NPV-equal annual cash inflows (Learning Objective 4)}

Use the NPV method to determine whether Salon Products should invest in the following projects:

- Project A: Costs \(\$ 272,000\) and offers eight annual net cash inflows of \(\$ 60,000\). Salon Products requires an annual return of \(14 \%\) on projects like \(A\).

- Project B: Costs \(\$ 380,000\) and offers nine annual net cash inflows of \(\$ 70,000\). Salon Products demands an annual return of \(12 \%\) on investments of this nature.

What is the NPV of each project? What is the maximum acceptable price to pay for each project?