alternative capital investments. The investment committee of century insurance company is evaluating two projects, office expansion and upgrade to computer servers. The projects have different useful lives each requires an investment of $490,000. Estimated net cash flows from each project are as follows:

The committee have selected a rate of 12% for purposes of net present value analysis. It also estimates that the residual value at the end of each projects for life is zero dollars but at the end of the fourth year the office expansions residual value would be $180,000.

For each project, compute, the net present value, use the present value of a annuity of 1 dollar table above. Ignore the unequal lives of the project, if required round to the nearest dollar.

for each project, compute, the net present value, assuming the office expansion is adjusted to, a 4-year life for purpose of analysis is the present value of one dollar table above

fourth year, the office expansion's residual value would be $180, Present Value of an Annuity of $1 at Compound Interest Required: 1. For each project, compute the net present value. Use the pres Present value of annual net cash flows Amount to be invested Net present value 2. For each project, compute the net present value, assuming that the office expansion is adjus