Dixie Dynamite Company is evaluating two methods of blowing up old buildings for commercial purposes over the next five years. Method one (implosion) is relatively low in risk for this business and will carry a 11 percent discount rate. Method two (explosion) is less expensive to perform but more dangerous and will call for a higher discount rate of 15 percent. Either method will require an initial capital outlay of $90,000. The inflows from projected business over the next five years are shown next.

Years	Method 1	Method 2
1	$	31,600		$	22,800
2		36,800			24,800
3		45,000			34,300
4		36,000			32,400
5		22,200			71,700

UseAppendix Bfor an approximateanswerbut calculate your final answers using the formula and financialcalculatormethods. a. Calculate net present value for Method 1 and Method 2.(Do not roundintermediate calculationsand round your answers to 2 decimal places.)

b. Which method should be selected using net present value analysis?

Method 1

Method 2

Neither of these

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