Consider the following opportunities: Opportunity 1 requires a $4,500 cash payment now (Year 0) but will result in $16,800 cash received in Year 5. Opportunity 2 requires no cash outlay and results in $4,950 cash received in years 3 and 5. Use Appendix A and Appendix B.

Required:

1. Use a 6 percent discount rate and determine whether Opportunity 1 or Opportunity 2 results in a greater NPV.
2. Use a 10 percent discount rate and determine whether Opportunity 1 or Opportunity 2 results in a greater NPV.