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Annual cash inflows that will arise from two competing investment projects are given below: Year Investment A Investment B 1 $ 1,000 $4,000 2 2,000

Annual cash inflows that will arise from two competing investment projects are given below:

Year Investment A Investment B
1 $ 1,000 $4,000
2 2,000 3,000
3 3,000 2,000
4 4,000 1,000

Total $10,000 $10,000

The discount rate is 11%.

Required:

Compute the present value of the cash inflows for each investment. Each investment opportunity will require the same initial investment. (Use Microsoft Excel to calculate present values. Do not round intermediate calculations.)

image text in transcribed

Present Value of Amount of Cash Flows Cash Flows Investmenestmnvestmdnvestm Year B A B A 1 4 23

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