b. run NPVs and IRRs for three airplane fuel pumps. Use a 12% discount rate:

Pump A costs $35,000 and saves the firm $5,000 each year for years 1-15

Pump B costs $35,000 and saves the firm $4,500 each year for ever

Pump C costs $35,000 and saves $4,000 in year 1; this saving continues for ever, increasing 4% per year

Pump B Pump C Pump A Discount rate Growth rate NPV IRR Cash Flows: Start Year 16 and on