Discount Rate Capital Available 10% $0 Expected Cash Flows (in $ millions) Selected ? (0=no, Project 1=yes) A B Initial Cost Year 1 Year 2 Year 3 Year 4 Year 5 NPV $300 $100 $275 $300 $200 $50 $411.23 $250 $400 $300 $200 $100 $0 $580.13 $350 $50 $200 $50 $200 $50 $65.96 $475 $75 $100 $125 $150 $175 ($19.15) $200 $0 $0 $0 $500 $500 $451.97 $150 $50 $50 $50 $50 $50 $39.54 F 7) if you could choose one or more of these projects and you have a hard budget constraint of $600, which projects would you choose? What is the total NPV achieved? How much of your budget was left unspent? 8) If you could choose one or more of these projects and you have a hard budget constraint of $1,000, which projects would you choose? What is the total NPV achieved? How much of your budget was left unspent? 9) Finally, if the budget remains at $1,000, which projects would you choose where selecting of project B requires the selection of project C? What is the total NPV achieved? How much of your budget was left unspent