Assuming a 10% discount rate, calculate the NPV of the four projects and rank the projects in order of preference. Show steps.

1. Growth Enterprise , Inc. (GEI) has $40 million that it can invest in any or all of the four capital investment projects (A, B, C, D), which have cash flows as shown in the following table. Table 1. Comparison of Project Cash Flows (S thousand dollars Project Type of cash flow Investment-$10,000 Revenue Operating expense Year 0 Year 1 Year 2 Year 3 0 0 $21,000 $11,000 0 Investment -$10,000 Revenue Operating expense 0 $17,000 $7,833 $15,000 $5,833 0 0 Investment -$10,000 Revenue Operating expense $30,000 $15,555 0 $10,000 $5,555 $11,000 $4,889 Investment-$10,000 Revenue Operatingg expense 0 $10,000 $5,555 $30,000 $15,555 $5,000 $2,222 All revenues and operating expenses can be considered cash items Each of these projects is considered to be of equivalent risk. The investment will be depreciated to zero on a straight-line basis for tax purpose. For simplicity, the depreciation per year for a project is equal to the project investment value divided by the life of the project. Project A has 1-year life, Project B has two-year life, and both Project C and D have 3-yar life. GEI's marginal corporate tax rate on taxable income is 40%. None of the projects will have any salvage value at the end of their respective lives. 1. Growth Enterprise , Inc. (GEI) has $40 million that it can invest in any or all of the four capital investment projects (A, B, C, D), which have cash flows as shown in the following table. Table 1. Comparison of Project Cash Flows (S thousand dollars Project Type of cash flow Investment-$10,000 Revenue Operating expense Year 0 Year 1 Year 2 Year 3 0 0 $21,000 $11,000 0 Investment -$10,000 Revenue Operating expense 0 $17,000 $7,833 $15,000 $5,833 0 0 Investment -$10,000 Revenue Operating expense $30,000 $15,555 0 $10,000 $5,555 $11,000 $4,889 Investment-$10,000 Revenue Operatingg expense 0 $10,000 $5,555 $30,000 $15,555 $5,000 $2,222 All revenues and operating expenses can be considered cash items Each of these projects is considered to be of equivalent risk. The investment will be depreciated to zero on a straight-line basis for tax purpose. For simplicity, the depreciation per year for a project is equal to the project investment value divided by the life of the project. Project A has 1-year life, Project B has two-year life, and both Project C and D have 3-yar life. GEI's marginal corporate tax rate on taxable income is 40%. None of the projects will have any salvage value at the end of their respective lives