FasTrac is considering investing in a Project A and Project B which will require an initial investment of $16,000. Assume FasTrac requires a 11% annual return. The expected annual cash inflows are as follows:

Project A Project B

1 $3,000 1 $4,000

2 $4,000 2 $4,000

3 $4,000 3 $4,000

4 $4,000 4 $4,000

5 $5,000 5 $4,000

6 $3,000 6 $4,000

7 $2,000 7 $4,000

8 $2,000 8 $4,000

1 What is the NPV for Project A?

A. $1,735.85

B. $1,911.23

C. $2,235.67

D. $2,366.95

2 What is the IRR for Project A?

A. 12.25%

B. 14.47%

C. 16.25%

D. 18.30%

3 What is the payback period for Project A?

A. 3.5 years

B. 3.75 years

C. 4.0 years

D. 4.2 years

4 What is the NPV for Project B?

A. $4,154.35

B. $4,425.93

C. $4,584.49

D. $4,750.35

5 What is the IRR for Project B?

A. 18.62%

B. 16.58%

C. 14.35%

D. 12.10%

6 What is the payback period for Project B?

A. 3.5 years

B. 4.0 years

C. 4.25 years

D. 4.60 years

7 Bonus Question!! You have taken out a $25,000 loan to purchase a car. Your interest rate is 6% and your loan term is 4 years. How much is your monthly car payment?

$524.56

$587.13

$595.39

$602.85