1. Continental Railroad Company is evaluating three capital investment proposals by using the net present value method. Relevant data related to the proposals are summarized as follows:

   		Maintenance Equipment		Ramp Facilities		Computer Network
   Amount to be invested		$713,693		$424,146		$212,463
   Annual net cash flows:
   	Year 1	293,000		205,000		126,000
   	Year 2	272,000		185,000		87,000
   	Year 3	249,000		164,000		63,000

   Present Value of $1 at Compound Interest
   Year	6%	10%	12%	15%	20%
   1	0.943	0.909	0.893	0.870	0.833
   2	0.890	0.826	0.797	0.756	0.694
   3	0.840	0.751	0.712	0.658	0.579
   4	0.792	0.683	0.636	0.572	0.482
   5	0.747	0.621	0.567	0.497	0.402
   6	0.705	0.564	0.507	0.432	0.335
   7	0.665	0.513	0.452	0.376	0.279
   8	0.627	0.467	0.404	0.327	0.233
   9	0.592	0.424	0.361	0.284	0.194
   10	0.558	0.386	0.322	0.247	0.162

   Required:

   1. Assuming that the desired rate of return is 10%, prepare a net present value analysis for each proposal. Use the present value of $1 table above. If required, use the minus sign to indicate a negative net present value. If required, round to the nearest dollar.

   	Maintenance Equipment	Ramp Facilities	Computer Network
   Total present value of net cash flow	$fill in the blank 1	$fill in the blank 2	$fill in the blank 3
   Amount to be invested	fill in the blank 4	fill in the blank 5	fill in the blank 6
   Net present value	$fill in the blank 7	$fill in the blank 8	$fill in the blank 9

   2. Determine a present value index for each proposal. If required, round your answers to two decimal places.

   	Present Value Index
   Maintenance Equipment	fill in the blank 10
   Ramp Facilities	fill in the blank 11
   Computer Network	fill in the blank 12

   3. The _____ has the largest present value index. Although _____ has the largest net present value, it returns less present value per dollar invested than does the _____, as revealed by the present value indexes. The present value index for the _____ is less than 1, indicating that it does not meet the minimum rate of return standard.