D M NPV (ie than 8) F7 Investment Projected Cash Flows Year Project A Project B ols (4500 5 (45000) 1 2000 2000 2 2000 3000 3 2000 - 2000 13.596 1. Which project will be acceptable if nominal discount rate is 13.5%7 Calculate the NPV of both projects using a) a timeline and b) Excel's NPV function What is TRR and PI? 2. If a real required rate : 8.7% and you predict inflation is going to be 2.1% what is the NPV of both projects? (time line and ft). Use Nominal discount rate 3. Use IF function in grey cells to show if(what project) is accepted or rejected 4. Change cells using Custom formatting if needed Nominal Discount Rate Project A NPV using a Time Line Project B NPV using a Time Line Year 0 Year 1 Year 2 Year 3 Year 4 Year o Year 1 Year 2 Cash Flows PV of Each CF (forma) PV of Bach CF (function) NPV NPV (function) IRR P1 Cash Flows PV of Each CF (omula) PV of Each CF (nction) NPV NPV (function IRR PI -F Real Discount Rate Inflation Rate Nominal Discount Rate 7014 2.100 Project Project Year Year! Year 2 Year 3 Year 4 Year 0 Year 1 Year 2 Cash Flows Present Value of Each CF NPV NPV hunction Cash Flows PV of Fach Cash Flow NPV NPV (function) NPV IRR XNPV XRR 2 projects O