Consider each of the after-tax cash flows shown in the table below. Suppose that projects B and C are mutually exclusive. Suppose also that the required service period is eight years and that the company is considering leasing comparable equipment with an annual lease expense of $3,000, payable at the end of each year for the remaining years of the required service period. Which project is a better choice at 15%?

n;B;C 0;-$7,000;-$5,000 1;-2,500;-2,000 2;-2,000;-2,000 3;-1,500;-2,000 4;-1,500;-2,000 5;-1,500;-2,000 6;-1,500;-2,000 7;-;-2,000 8;-;-

a) What is the present worth of project B?

b) What is the present worth of project C?

c) Which project is a better choice?