Discounted Cash Flow (Project)
Interest rate/Cost of capital =	10%		Present = Beginning of year 2022
Annual inflation rate =	2.25%
	Investment	Net Profit	Investment	Net Profit
	PROJECT 1	PROJECT 2
Beginning of 2022	$2,200,000	($2,200,000)	$3,280,000	($3,280,000)
Beginning of 2023		$300,000		$400,000
Beginning of 2024		$650,000		$1,200,000
Beginning of 2025		$975,000		$1,000,000
Beginning of 2026		$1,230,000		$2,085,000
	NPV (no infl) =	$4,582,556	NPV (no infl) =	$6,810,770
	NPV (infl) =	$752,406	NPV (infl) =	$4,381,903
	IRR =	13.08%	IRR =	12.83%
	ROI (no infl) =	208.30%	ROI (infl)	133.59%
If projects are selected based on NPV, would you choose Project 1 or Project 2?
If projects are selected based on IRR, would you choose Project 1 or Project 2?
Not considering inflation, in which year is Project 1's investment recovered?	1	Hint: Don't calculate! Use the EXCEL NPV formula a few times.
Not considering inflation, in which year is Project 2's investment recovered?