3)Let's say you're the CFO of a company and you want to invest in two different projects. When evaluating the projects, you will use a cost of capital of 15%. You can only choose one of these projects because the company has very limited capital. Project A needs an initial investment of 100,000 TL at the start. Project B needs an initial investment of 10,000 TL, which must be paid off in 11 equal payments. Starting in Year 3, Project A will bring in 30,000 TL every year for 7 years. Starting in Year 4, Project B will give back 40,000 TL each year for 6 years. Starting in Year 1, both projects have yearly maintenance costs of 25,000 TL. Project A makes $117,500 every year starting in year 10 and Project B makes $86,500 every year starting in year 10.

a)What are net present values of the projects A and B?

b)Which project should be chosen, and why?