Dynamite Company is evaluating two new methods of blowing up buildings for commercial purposes over the next five years. Method 1 (implosion) is relatively low in risk for this business and will carry a 10 percent discount rate. Method 2 (explosion) is less expensive to perform, but it is more dangerous and will require a higher discount rate of 15 percent. Either method will require an initial capital outlay $90,000. The inflows from projected business over the next five years are given below.

Years	Method 1	Method 2
1	$25,000	$16,000
2	30,000	22,000
3	38,000	34,000
4	31,000	29,000
5	19,000	70,000

a. Calculate NPV for Method 1 and Method 2. (Round "PV Factor" to 3 decimal places. Do not round intermediate calculations. Round the final answers to the nearest whole dollar.)

	Net present value
Method 1	$
Method 2	$

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

multiple choice

Method 1

Method 2

Neither of these