Following is information on two alternative investments being considered by Tiger Co. The company requires a 7% return from its investments. (PV of $1, FV of $1. PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Project X1 $(96,e80) Project X2 $(152,000) Initial investment Expected net cash flows in year: 1 33,000 43,500 68,500 72,ee0 62,000 52,000 a. Compute each project's net present value. b. Compute each project's profitability index. If the company can choose only one project, which should it choose? Complete this question by entering your answers in the tabs below. Required A Required B Compute each project's net present value. (Round your final inswers to the nearest dollar.) Net Cash Flows Present Value Present Value of Net Cash Flows of 1 at 7% Project X1 Year 1 Year 2 Year 1 Year 2 Year 3 0 $ $ 0 Totals Amount invested $ Net present value Project X2 Year 1 Year 2 Year 3 0 $ Totals Amount invested $ 0 Net present value Requi Required A Required B Compute each project's profitability index. If the company can choose only one project, which should it choose? Profitability Index Profitability Index Choose Numerator: Choose Denominator: Profitability index 0 Project X1 0 Project X2 If the company can choose only one project, which should it choose? p=1/(1+ ir TABLE B.1 Present Value of 1 Rate 15% 10% 12% 8 % 9% 7% 6% 5% 4% 3% 2% Perlods 1% 0.8696 0.9174 0.9091 0.8929 0.9259 0.9346 0.9524 0.9434 0.9615 0.9804 0.9709 0.9901 1 0.7561 0.6575 0.5718 0.8264 0.7972 0.8417 0.8734 0.8573 0.9070 0.8900 0.9426 0.9246 0.8890 0.9803 0.9706 0.9612 0.7118 0.7722 0.7084 0.6499 0.7513 0.7938 0.8163 0.8396 0.8638 0.9151 0.9423 3 0.6355 0.6830 0.7629 0.7130 0.7350 0.7921 0.8548 0.8227 0.9238 0.8885 0.9610 4 0.4972 0.6209 0.5645 0.5674 0.6806 0.7473 0.8626 0.8219 0.7835 0.9057 5 0.9515 0.5963 0.5470 0.5066 0.4323 0.3759 0.3269 0.2843 0.2472 0.2149 0.1869 0.1625 0.1413 0.6302 0.6663 0.7903 0.7050 0.8880 0.7462 08375 0.9420 6 0.5132 0.4523 0.5835 0.5403 0.6227 0.5820 0.7107 0.6651 0.6274 0.7599 0.7307 0.8706 0.8535 0.8131 0.9327 0.9235 7 0.4039 0.3606 0.4665 0.5019 0.7894 0.6768 8 0.4241 0.5002 0.4604 0.5439 0.6446 0.5919 0.5584 0.5268 0.8368 0.7664 0.7026 0.9143 0.3220 0.3855 0.4632 0.4224 0.5083 0.6756 0.6496 0.6139 0.7441 0.9053 0.8203 10 0.3505 0.2875 0.3875 0.4751 0.4289 0.5847 0.7224 0.8043 11 0.8963 0.2567 0.2292 0.3555 0.3186 0.3971 0.4970 0.4440 0.5568 0.8874 0.8787 0.7014 0.6246 0.7885 0.7730 12 0.2897 0.3262 0.4150 0.3677 0.5303 0.4688 0.6006 0.6810 13 0.233 0.2394 0.2046 0.2992 0.3878 0.3405 0.5051 0.4423 0.5775 0.6611 0.8700 0.7579 14 0.1229 0.1827 0.3152 0.2745 0.3624 0.4810 0.4173 0.6419 0.5553 0.7430 15 0.8613 0.1069 0.0929 0.1631 0.2176 0.2519 0.3936 0.3387 0.2919 0.4581 0.7284 0.7142 0.5339 0.6232 16 0.8528 0.1978 0.1799 0.1635 0.1456 0.2311 0.3166 0.2703 0.2502 0.4363 0.3714 0.5134 0.6050 0.8444 17 18 0.0808 0.0703 0.0611 0.0304 0.0151 0.0075 0.0037 0.2120 0.1945 0.1300 0.3503 0.2959 0.4936 0.4155 0.7002 0.5874 0.8360 0.1161 0.1037 0.2317 0.3305 0.2765 0.4746 0.3957 0.5703 0.6864 19 0.8277 0.1486 0.1784 0.3118 0.2584 0.2145 0.3769 0.4564 0.5537 20 0.8195 0.6730 0.0588 0.0923 0.1160 0.2330 0.1842 0.1460 0.3751 0.2953 0.4776 0.7798 0.6095 25 0.0334 0.0754 0.0573 0.1741 0.1314 0.0994 0.3083 0.2314 0.5521 0.4120 30 0.7419 0.0189 0.0107 0.0356 0.0490 0.1813 0.1420 0.0937 0.0676 0.2534 0.1301 0.5000 0.3554 0.7059 35 0.0318 0.0221 0.0668 0.0460 0.0972 0.3066 0.2083 0.6717 0.4529 40 Used to compute the present value of a known future amount. For example: How much would you need to invest today at 10% compounded semiannually to accumulate $5,000 in 6 years from today? Using the factors of n 12 and i 5% (12 semiannual periods and a semiannual rate of 5%) , the factor is 0.5568. You would need to invest $2,784 today ($5,000 x 0.5568). Future Value of 1 Rate 15% 12% 10% 9% 8% 7% 5% 6% 3% 2% Perlods 1% 1.0000 1.1200 1.0000 1.1000 1.0000 1.0000 1.0900- 1.0000 1.0800 1.1664 1.2597 1.0000 1.0700 1.0000 1.0000 1.0000 1.0000 1.0100 1.0201 1.0000 1.0000 0 1.1500 1.3225 1.0300 1.0609 1.0600 1.0200 1,0404 1.0400 1.0500 1.2544 1.2100 1.1881 1.1449 1.1025 1.1236 1.0816 1.3310 1.5209 1.2950 1.4049 1.2250 1.1576 1.2155 1.1910 1.0927 1.1249 1.0303 1.0612 3 1.7490 1.4641 1.6105 1.7716 1.5735 1.4116 1.3605 1.2625 1.3108 1.0406 1.0510 1.1255 1.1699 1.0824 20114 1.7623 1.4026 1.5007 1.6058 1.7182 1.4693 1.5386 1.2167 1.2653 1.3382 1.2763 1.1593 1.1041 5 1.9738 2.3131 1.6771 1.5869 1.4185 1.5036 1.5938 1.6895 1.3401 1.1941 1.0615 1.1262 6 2.6600 22107 1.8280 1.9487 1.7138 1,4071 1.1487 1.2299 1.3159 1.0721 7 2.1436 2.3579 3.0590 2.4760 1.9926 1.8509 14775 1.5513 1.0829 1.0937 1.3686 1.1717 1.2668 8 3.5179 4.0456 2.7731 2.1719 1.8385 1.9990 1.4233 1.3048 1.1951 9 3.1058 2.5937 1.9672 2.1589 2.3674 1.6289 1.7908 1.4802 1.2190 1.3439 10 1.1046 4.6524 2.1049 2.2522 2.8531 3.4785 2.3316 2.5804 1.7103 1.8983 1.2434 1.2682 1.5395 1.3842 11 1.1157 5.3503 6.1528 3.8960 2.0122 2.1329 2.5182 2.8127 3.1384 1.7959 1.4258 1.6010 12 1.1268 4.3635 3.0658 3.4523 2.4098 2.7196 1.8856 1.9799 1.1381 16651 1.2936 1.4685 13 2.9372 4.8871 7.0757 2.5785 3.3417 3.7975 2.2609 1.5126 1.7317 1.3195 14 1.1495 5.4736 8.1371 9.3576 2.3966 3.1722 3.6425 4.1772 2.7590 2.0789 1.1610 1.3459 1.5580 1.8009 15 6.1304 6.8660 7.6900 8.6128 9.6463 2.5404 2.9522 3.4259 3.9703 4.5950 1.8730 2.1829 1.3728 1.6047 16 1.1726 3.1588 3.3799 10.7613 12.3755 5.0545 2.6928 2.8543 3.7000 4.3276 1.6528 1.9479 2.2920 17 1.1843 1.4002 3.9960 4.7171 5.5599 2.4066 1.4282 1.7024 2.0258 18 1.1961 5.1417 14.2318 2.1068 3.6165 4.3157 6.1159 1.7535 2.5270 3.0256 19 1.2081 1.4568 16.3665 3.2071 6.7275 2.1911 2.6533 3.8697 4.6610 5.6044 1.2202 1.4859 1.8061 20 17.0001 32.9190 5.4274 6.8485 8.6231 10.8347 1.6406 2.0938 2.4273 2.8139 2.6658 3.3864 4.2919 25 1.2824 29.9599 52.7996 66.2118 1.3478 5.7435 7.6123 10.0627 13.2677 17.4494 30 1.8114 3.2434 4.3219 133.1755 1.9999 3.9461 7.6861 10.6766 14.7853 20.4140 28.1024 35 1.4166 5.5160 45.2593 267.8635 31.4094 93.0510 1.4889 2.2080 3.2620 4.8010 7.0400 10.2857 14.9745 21.7245 40 Used to compute the future value of a known present amount. For example: What is the accumulated value of $3,000 invested today at 8% compounded quarterly for 5 years? Using the factors of n 20 and i= 2% ( 20 quarterly periods and a quarterly interest rate of 2%), the factor is L.4859. The accumalated value is $4,457.70 ($3,000 x 1.4859). Present Value of an Annuity of 1 Rate 15% 10% 12% 9% 8% 7% 6% 5% 4% 3% 2% Perlods 0.8696 1.6257 0.9091 1.7355 2.4869 0.8929 0.9174 0.9259 0.9346 18080 2.6243 3.3872 09434 1.8334 2.6730 0.9615 0.9524 0.9804 1.9416 2.8839 3.8077 0.9709 0.9901 1.9704 1.6901 1 1.7833 2.5771 3.3121 1.7591 1.8594 1.9135 1.8861 2 2.2832 2.4018 2.5313 3.2397 2.7751 2.7232 2.8286 2.9410 3.0373 3.6048 4.1114 31 2.8550 3.1699 3.5460 3.4651 3.7171 3.6299 3.9020 4 3.3522 3.7908 4.3553 3.9927 4.6229 3.8897 42124 49173 5.5824 6.2098 4.1002 4.3295 4.4518 4.5797 4.7135 4.8534 3.7845 4.4859 4.7665 5.3893 5.9713 6.5152 7.0236 5.0757 5.7864 6.4632 52421 6.0021 6.7327 5.4172 6.2303 5,6014 5.7955 6.7282 76517 6 4.1604 5.0330 5.5348 5.9952 4.8684 5.3349 5.7590 4.5638 5.2064 6.4720 4.4873 4.9676 5.7466 7.0197 7.3255 8 5.3282 4.7716 6.2469 6.8017 7.1078 7.7861 7.4353 8.1622 8.5660 9.4713 5.0188 5.2337 5.4206 5.581 6.1446 6.4951 5.6502 5.9377 6.1944 6.4235 6.6282 6.4177 6.7101 7.7217 8.3064 7.3601 8.1109 8.5302 8.9826 10 6.8052 7.1390 7.4987 7.8869 9.2526 9.9540 10.6350 11.2961 8.7605 9.7868 10.3676 11 7.1607 6.8137 7.9427 8.3577 7.5361 8.3838 8.8527 9.2950 8.8633 9.3851 9.9856 10.5753 11.3484 12.1062 11.2551 12 7.1034 7.3667 7.4869 7.9038 9.3936 12.1337 13 57245 5.8474 7.7862 8.2442 9.8986 10.3797 8.7455 10.5631 13.0037 14 6.8109 6.9740 7.1196 7.6061 7.8237 8.5595 8.0607 9.1079 9.4466 9.7122 11.1184 11.9379 12.8493 13.5777 13.8651 15 5.9542 6.0472 61280 8.3126 8.8514 10.8378 11.2741 11.6896 11.6523 12.1657 10.1059 12.5611 13.1661 13.7535 14.7179 15.5623 16.3983 16 8.5436 8.0216 9.7632 10.0591 9.1216 9.3719 9.6036 10.4773 10.8276 14.2919 17 7.2497 7.3658 8.2014 8.7556 12.6593 14.9920 18 61982 6.2593 8.3649 8.9501 11.1581 10.3356 12.0853 13.1339 14.3238 17.2260 15.6785 16.3514 19 7.4694 8.5136 9.8181 10.6748 11.2578 9.1285 11.4699 10.5940 12.4622 14.0939 15.3725 13.5903 18.0456 14.8775 20 6.4641 6.5660 7.8431 9.8226 9.0770 9.4269 12.7834 11.6536 12.4090 15.6221 17.2920 17.4131 19.5235 22.3965 25 30 22.0232 25.8077 29.4086 32.8347 8.0552 10.2737 13.7648 19.6004 6.6166 8.1755 8.2438 9.6442 11.6546 10.5668 12.9477 16.3742 14.4982 18.6646 24.9986 21.4872 35 6.6418 10.7574 9.7791 13.3317 11.9246 15.0463 17.1591 19.7928 27.3555 23.1148 40 Used to cakculate the present value of a series of equal payments made at the end of cach period. For example: What is the peesent value of $2,000 per year for 10 years assuming an anual interest rale of 9%. For (n 10, i9% ), the PV factor is 6.4177. $2.000 per year for 10 years is the equivalent of S12,835 today (52,000 x 6.4177) Future Vakue of an Annuity of 1 f-11+0-1yi Rate 15% 12% 10 % 9% 8% 7% 6% 4% 5% 3% 2% 1% Perlods 1.0000 1.0000 2.0900 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1,0000 1.0000 1 2.1500 2.1200 2.1000 2.0700 2.0800 2.0500 2.0600 2.0400 2.0100 30301 2.0300 2.0200 2 34725 3.3744 3.3100 3.2464 3.2781 3.2149 3.1525 3.1836 3.0909 3.1216 3.0604 3 4.9934 4.7793 4.5731 4.6410 4.4399 4.5061 4.3746 4.3101 4.1216 4.1836 4.2465 4.0604 4 6.7424 6.3528 6.1051 5.9847 5.866 7.3359 5.6371 6.9753 8.3938 5.7507 5.5256 5.1010 6.1520 5.4163 5.2040 5.3091 5 8.7537 7.5233 9.2004 8.1152 7.7156 6.8019 8.1420 7.1533 6.6330 6.4684 6.3081 6 11.0668 10.0890 9.4872 8.9228 8.6540 7.6625 7.8983 7,4343 7.2135 11.4359 13.5795 12.2997 14.7757 13.7268 10.2598 11.9780 10.6366 11.0285 9.8975 8.5830 9.7546 10.9497 12.1687 9.5491 8.8923 9.2142 8.2857 8 16.7858 13.0210 12.4876 10.5828 11.0266 11.4913 10.1591 9.3685 17.5487 20.3037 15.1929 14.4866 15.9374 13.1808 13.8164 11.4639 12.0061 12.5779 10.4622 10 24.3493 29.0017 18.5312 20.6546 15.7836 17.8885 20.1406 16.6455 17.5603 14.2068 14.9716 12.8078 13.4864 11 11.5668 21.3843 24.1331 18.9771 20.1407 15.0258 16.6268 16.8699 15.9171 13.4121 14.1920 12 12.6825 34.3519 22.9534 26.0192 24.5227 28.0291 21.4953 17.7130 19.5986 18.8821 14.6803 15.6178 13.8093 13 40.5047 32.3926 27.9750 21.0151 22.5505 24.2149 17.0863 18.5989 20.1569 18.2919 14.9474 15.9739 14 47.5804 31.7725 37.2797 42.7533 48.8837 25.1290 29.3609 23.2760 27.1521 21.5786 16.0969 17.2934 20.0236 15 55.7175 30.3243 33.0034 35.9497 25.6725 28.2129 30.9057 33.7600 36.7856 27.8881 21.8245 23.6575 17.2579 18.6393 16 65.0751 75.8364 88.2118 36.9737 40.5447 30.8402 33.7502 25.8404 23.6975 18.4304 20.0121 21.7616 17 45.5992 51.1591 55.7497 33.9990 37.4502 41.3013 28.1324 19.6147 21.4123 20.8109 22.8406 22.0190 25.6454 18 23.4144 41.4463 63.4397 72.0524 133.3339 37.3790 46.0185 30.5390 25.1169 27.6712 19 45.7620 102.4436 40.9955 51.1601 57.2750 33.0660 24.2974 26.8704 32.0303 36.4593 40.5681 29.7781 20 84.7009 212.7930 63.2490 73.1059 98.3471 54.8645 41.6459 47.7271 28.2432 136.3075 164.4940 241.3327 431.6635 767.0914 434.7451 56.0849 66.4388 79.0582 111.4348 154.7620 94.4608 113.2832 172.3168 259.0565 34.7849 30 35 47.5754 881.1702 1,779.0903 215.7108 271.0244 337.8824 442.5926 736522 90.3203 138.2369 41.6603 49.9945 60.4621 60.4020 75.4013 95.0255 120.7998 199.6351 40 48 8864 Used to calculate the future value of a series of equal payments made at the end of each period. For example: What is the future value of $4,000 per year for 6 years assuming an annual interest rate of 8%. For (n= 6,i=8% ), the FV factor is 7.3359. $4,000 per year for 6 years accumulates to $29,343.60 (54,000 x 7.3359)