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Given two projects with the life of five years, the benefits and costs of each project in each year are shown in Table 1. Assume
Given two projects with the life of five years, the benefits and costs of each project in each year are shown in Table 1. Assume the discount rate is 9%. Please 1) Compute the NPV, IRR, and ROI of each project; 2) Find out in which year each project starts to pay back; and 3) Decide which project is financially more valuable. Project 1 Year 1 Year 2 Year 3 Year 4 Year 5 Benefits $0 $3000 $3000 $3000 $3000 Costs $3000 $1000 $1000 $1000 $1000 Project 2 Year 1 Year 2 Year 3 Year 4 Year 5 Benefits $0 $1000 $5000 $5000 $1000 Costs $2000 $2000 $2000 $1000 $0 Table 1. Expected benefits and costs of each project in each year. Given two projects with the life of five years, the benefits and costs of each project in each year are shown in Table 1. Assume the discount rate is 9%. Please 1) Compute the NPV, IRR, and ROI of each project; 2) Find out in which year each project starts to pay back; and 3) Decide which project is financially more valuable. Project 1 Year 1 Year 2 Year 3 Year 4 Year 5 Benefits $0 $3000 $3000 $3000 $3000 Costs $3000 $1000 $1000 $1000 $1000 Project 2 Year 1 Year 2 Year 3 Year 4 Year 5 Benefits $0 $1000 $5000 $5000 $1000 Costs $2000 $2000 $2000 $1000 $0 Table 1. Expected benefits and costs of each project in each year
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