Austin Jack Inc. is considering the following machines

Machine A

Cost $500,000

Expected Life 6 years

CF/Year $220,000

Machine B

Cost $260,000

Expected Life 3 years

CF/Year $200,000

Assume that the cost of capital is 12 percent.

15. What is the NPV for project A? *

A. $380,605

B. $404,510

C. $905,215

D. $510,000 E. None of the above

16. What is the NPV for project B? *

A. $220,366 B. $480,366

C. $740,366

D. $350,366

E. None of the above

17. What is the Equivalent Annual Annuity (EAA) for project A? *

A. $105,120

B. $98,387

C. $88,312

D. $77,200

E. None of the above

18. What is the Equivalent Annual Annuity (EAA) for project B? *

A. $91,749

B. $75,822

C. $108,200

D. $65,410

E. None of the above