Calculate the initial investment required for each projectStstainable Power Solutions $($SPS$),$ a forwand$-$thinking energy company, is at a critical juncture,

considering two mutually exchsive projects for expansion. As the concluding activity for your

principles of finance course, your goal is to analyze both projects using capital budgeting technigues

and recommend the most financially sound opoion to the company's executive boand.

$+$Case Study Scenanio:"

You are a team of financial amalysts uaked with evaluating the feasibility of Green Energy Ventures'

expinsion project. The project invohes the following key details:

"Initial lnvestment:$"$ The project requires a substantial inital investment, covering land

asquisition, solar panek, buttery stonge systems, inseallation, and working capial.

"Expected Cash Flows:" The projocted annul cach floas over the next $10$ years are based on

revenue from encrgy sales, operational costs, and maintenasce expenses.

"Discount Rate:" The compuny's cost of eapital is $1125\%,$ representing the minimum

acceptable rate of retum for investment projects.

$**$Project Deuile$*$t

"Project A: Hydrocketric Power Plant"

A project focused on constructing a bydroekctric power plant to hamess energy from a nearby

miver.

"Project B$.$ Biomars Eneryy Production"$*$

A project aimed at establishing a biomass encrgy production facility, utilining organic waste

miterits for enerny genention.

"Initial Investment:"

Project A: $$30$ million

Dam Construction: $$15$ milison

Turbines and Genemors: $$10$ milion

Environmenual Impact Assessments: $$3$ million

Working Capital $$2$ million

Project B: $$25$ million

Facility Construction: $$12$ million

Biomass Processing Equipment $58$ milion

Regulatory Compliance and Permits: $$3$ million

Working Capital: $$2$ million

"Annual Cash Flows $($in millions LSD$)$:

Year $1$:

Project A: $$8\mathrm{.}0$

Project B: $$7\mathrm{.}5$

Year $2$:

Project A: $$9\mathrm{.}0$

Project B: $$8\mathrm{.}0$