A firm's cost of capital is 12 percent. The firm has three investments to choose among; the cash flows of each are as follows: Cash Inflows Year B 1 $588 $1,920 2 588 3 588 4 $3,102 Each investment requires a $1,600 cash outlay, and investments B and C are mutually exclusive. Use Appendix A, Appendix B and Appendix D to answer the questions. Assume that the investments are not mutually exclusive and there are no budget restrictions. a. Which investment(s) should the firm make according to the net present values? Use a minus sign to enter negative values, if any. Round your answers to the nearest dollar. A: $ B: $ C: $ The firm should make investment(s) ( -Select- b. Which investment(s) should the firm make according to the internal rates of return? Round your answers to the nearest whole number. A: % B: % C: % The firm should make investment(s)[ -Select- c. If all funds from investment C are reinvested at 18 percent, which investment(s) should the firm make? Round your answer to the nearest dollar. Terminal value of investment C: $ The firm should make investment(s) (-Select- Would your answer be different if the reinvestment rate were 12 percent? Round your answer to the nearest dollar. Terminal value of investment C: $ The firm should make investment(s) ( -Select- Interest Factors for the Present Value of an Annuity of One Dollar Time Period (e.g. year) -NMetin 2 3 4 5 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 12% 14% 16% 18% 20% 24% 28% 32% 36% 0.990 0.980 0.971 0.962 0.952 0.943 0.935 0.926 0.917 0.909 0.893 0.877 0.862 0.847 0.833 0.806 0.781 0.758 0.735 1.970 1.942 1.913 1.886 1.859 1.833 1.808 1.783 1.759 1.736 1.690 1.647 1.605 1.566 1.528 1.457 1.392 1.332 1.276 2.941 2.884 2.829 2.775 2.723 2.673 2.624 2.577 2.531 2.487 2.402 2.322 2.246 2.174 2.106 1.981 1.868 1.766 1.674 3.902 3.808 3.717 3.630 3.546 3.465 3.387 3.312 3.240 3.170 3.037 2.914 2.798 2.690 2.589 2.404 2.241 2.096 1.966 4.853 4.713 4.580 4.452 4.329 4.212 4.100 3.993 3.890 3.791 3.605 3.433 3.274 3.127 2.991 2.745 2.532 2.345 2.181 6 7 8 9 10 000 5.795 5.601 5.417 5.242 5.076 4.917 4.766 4.623 4.486 4.355 4.111 3.889 3.685 3.498 3.326 3.020 2.759 2.534 2.399 6.728 6.472 6.230 6.002 5.786 5.582 5.389 5.206 5.033 4.868 4.564 4.288 4.039 3.812 3.605 3.242 2.937 2.678 2.455 7.652 7.325 7.020 6.733 6.463 6.210 5.971 5.747 5.535 5.335 4.968 4.639 4.344 4.078 3.837 3.421 3.076 2.786 2.540 8.566 8.162 7.786 7.435 7.108 6.802 6.515 6.247 5.985 5.759 5.328 4.946 4.607 4.303 4.031 3.566 3.184 2.868 2.603 9.471 8.983 8.530 8.111 7.722 7.360 7.024 6.710 6.418 6.145 5.650 5.216 4.833 4.494 4.193 3.682 3.269 2.930 2.650 11 12 13 14 15 10.368 9.787 9.253 8.760 8.306 7.887 7.499 7.139 6.805 6.495 5.988 5.453 5.029 4.656 4.327 3.776 3.335 2.978 2.683 11.255 10.575 9.954 9.385 8.863 8.384 7.943 7.536 7.161 6.814 6.194 5.660 5.197 4.793 4.439 3.851 3.387 3.013 2.708 12.134 11.348 10.635 9.986 9.394 8.534 8.358 7.904 7.487 7.103 6.424 5.842 5.342 4.910 4.533 3.912 3.427 3.040 2.727 13.004 12.106 11.296 10.563 9.899 9.295 8.745 8.244 7.786 7.367 6.628 6.002 5.468 5.008 4.611 3.962 3.459 3.061 2.740 13.865 12.849 11.938 11.118 10.380 9.712 9.108 8.559 8.060 7.606 6.811 6.142 5.575 5.092 4.675 4.001 3.483 3.076 2.750 16 17 18 19 20 14.718 13.578 12.561 11.652 10.838 10.106 9.447 8.851 8.312 7.824 6.974 6.265 5.669 5.162 4.730 4.003 3.503 3.088 2.758 15.562 14.292 13.166 12.166 11.274 10.477 9.763 9.122 8.544 8.002 7.120 6.373 5.749 5.222 4.775 4.059 3.518 3.097 2.763 16.398 14.992 13.754 12.659 11.690 10.828 10.059 9.372 8.756 8.2017.250 6.467 5.818 5.273 4.812 4.080 3.529 3.104 2.767 17.226 15.678 14.324 13.134 12.085 11.158 10.336 9.604 8.950 8.365 7.366 6.550 5.877 5.316 4.844 4.097 3.539 3.109 2.770 18.046 16.351 14.877 13.590 12.462 11.470 10.594 9.818 9.128 8.514 7.469 6.623 5.929 5.353 4.870 4.110 3.546 3.113 2.772 25 22.023 19.523 17.413 15.622 14.094 12.783 11.654 10.675 9.823 9.077 7.843 6.873 6.097 5.467 4.948 4.147 3.564 3.122 2.776 30 25.808 22.937 19.600 17.292 15.373 13.765 12.409 11.258 10.274 9.427 8.055 7.003 6.177 5.517 4.979 4.160 3.569 3.124 2.778 Interest Factors for the Present Value of One Dollar Time Period (e.g. year) 1 20% 24% 28% NM 000 = 25 30 Interest Factors for the Future Value of One Dollar 8% 9% 10% 16% Time Period (e.g. year) 1 2 3 4. 5 NM 1% 2% 3% 4% 5% 1.010 1.020 1.030 1.040 1.050 1.020 1.040 1.061 1.082 1.102 1.030 1.061 1.093 1.125 1.158 1.041 1.082 1.126 1.170 1.216 1.051 1.104 1.159 1.217 1.276 6% 7% 1.060 1.070 1.124 1.145 1.191 1.225 1.262 1.311 1.338 1.403 1.080 1.166 1.260 1.360 1.469 1.090 1.188 1.295 1.412 1.539 1.100 1.210 1.331 1.464 1.611 12% 1.120 1.254 1.405 1.574 1.762 14% 1.140 1.300 1.482 1.689 1.925 15% 1.150 1.322 1.521 1.749 2.011 1.160 1.346 1.561 1.811 2.100 18% 1.180 1.392 1.643 1.939 2.288 20% 1.200 1.440 1.728 2.074 2.488 6 7 8 9 10 1.062 1.126 1.194 1.265 1.340 1.419 1.501 1.072 1.149 1.230 1.316 1.407 1.504 1.606 1.083 1.172 1.267 1.369 1.477 1.594 1.718 1.094 1.195 1.305 1.423 1.551 1.689 1.838 1.105 1.219 1.344 1.480 1.629 1.791 1.967 1.587 1.714 1.851 1.999 2.159 1.677 1.828 1.993 2.172 2.367 1.772 1.949 2.144 2.358 2.594 1.974 2.211 2.476 2.773 3.106 2.195 2.502 2.853 3.252 3.707 2.313 2.660 3.059 3.518 4.046 2.436 2.826 3.278 3.803 4.411 2.700 3.186 3.759 4.436 5.234 2.986 3.583 4.300 5.160 6.192 H2BH5 11 12 13 14 15 1.116 1.127 1.138 1.149 1.161 1.243 1.384 1.539 1.710 1.898 2.105 1.268 1.426 1.601 1.796 2.012 2.252 1.294 1.469 1.665 1.886 2.133 2.410 1.319 1.513 1.732 1.980 2.261 2.579 1.346 1.558 1.801 2.079 2.397 2.759 2.332 2.518 2.720 2.937 3.172 2.580 2.813 3.066 3.342 3.642 2.853 3.138 3.452 3.797 4.177 3.479 3.896 4.363 4.887 5.474 4.226 4.818 5.492 6.261 7.138 4.652 5.350 6.153 7.076 8.137 5.117 5.936 6.886 7.988 9.266 6.176 7.287 8.599 10.147 11.973 7.430 8.916 10.699 12.839 15.407 16 17 18 19 20 1.173 1.373 1.605 1.873 2.183 2.540 2.952 1.184 1.400 1.653 1.948 2.292 2.693 3.159 1.196 1.428 1.702 2.026 2.407 2.854 3.380 1.208 1.457 1.754 2.107 2.527 3.026 3.617 1.220 1.486 1.806 2.191 2.653 3.207 3.870 3.426 3.700 3.996 4.316 4.661 3.970 4.328 4.717 5.142 5.604 4.595 5.054 5.560 6.116 6.728 6.130 8.137 6.866 9.276 7.690 10.575 8.613 12.056 9.646 13.743 9.358 10.748 10.761 12.468 12.375 14.463 14.232 16.777 16.367 19.461 14.129 16.672 19.673 23.214 27.393 18.488 22.186 26.623 31.948 38.337 25 1.282 1.641 2.094 2.666 3.386 4.292 5.427 6.848 8.623 10.835 17.000 26.462 32.919 40.874 62.688 95.396 30 1.348 1.811 2.427 3.243 4.322 5.743 7.612 10.063 13.268 17.449 29.960 50.950 66.212 85.850 143.370 237.370