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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

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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 12 percent discount rate. Method two (explosion) is less expensive to perform but more dangerous and will call for a higher discount rate of 14 percent. Either method will require an initial capital outlay of $85,000. The inflows from projected business over the next five years are shown next. Years 1 2 3 4 Method 1 $30, 200 36,900 45,400 32,500 28,600 Method 2 $16,900 23,400 38,400 32,600 72,000 Use Appendix B for an approximate answer but calculate your final answers using the formula and financial calculator methods. Calculate net present value for Method 1 and Method 2. (Do not round intermediate calculations and round your answers to 2 decimal places.) Net Present Value Method 1 Method 2 b. Which method should be selected using net present value analysis? O Method 1 O Method 2 O Neither of these

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