Annual cash flows from two competing investment opportunities are given. Each investment opportunity will require

the same initial investment.

$($Click the icon to view the competing investment opportunities.$)$

$($Click the icon to view the Present Value of $$1$ table.$)($Click the icon to view the Present Value of Annuity

of $$1$ table.$)$

Requirement

Assuming a $12\%$ interest rate, which investment opportunity would you choose?

Begin by computing the present value of each investment opportunity. $($Assume that the annual cash flows occur at

the end of each year. If using present value tables, use factor amounts rounded to three decimal places,

X$.$XXX$.$

Round intermediary computations and your final answer to the nearest whole dollar.$)$

The present value of investment opportunity $A$ is

The present value of investment opportunity $B$ is

Investment opportunity $[$ should be chosen because the present value of cash flows is

than the present

value of investment opportunity