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Content Area Project A requires an original investment of $62,300. The project will yield cash flows of $18,400 per year for 7 years. Project B

Content Area Project A requires an original investment of $62,300. The project will yield cash flows of $18,400 per year for 7 years. Project B has a computed net present value of $2,090 over a 4-year life. Project A could be sold at the end of 4 years for a price of $14,100. Below is a table for the present value of $1 at compound interest. Year 6% 10% 12% 1 0.943 0.909 0.893 2 0.890 0.826 0.797 3 0.840 0.751 0.712 4 0.792 0.683 0.636 5 0.747 0.621 0.567 Below is a table for the present value of an annuity of $1 at compound interest. Year 6% 10% 12% 1 0.943 0.909 0.893 2 1.833 1.736 1.690 3 2.673 2.487 2.402 4 3.465 3.170 3.037 5 4.212 3.791 3.605

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