Calculatethe project cash flow generated for Project A and Project B using the NPV method.

• Which project would you select, and why?
• Which project would you select under the payback method? The discount rate is 10% for both projects.
• UseMicrosoftExceltoprepareyouranswer.

Sample Template for Project A and Project B:

	Initial Investment	Year 1	Year 2	Year 3
Project A	(10,000)	5,000	5,000	5,000
Project B	(55,000)	20,000	20,000	20,000