Imagine that you have been charged with selecting the optimal set of investment projects to fund from the following list of 6 proposed projects. Discount Rate is 10%.

1) What is the NPV of Project A? ____________________
2) What is the NPV of Project B? ____________________
3) What is the NPV of Project C? ____________________
4) What is the NPV of Project D? ____________________
5) What is the NPV of Project E? ____________________
6) What is the NPV of Project F? ____________________
7) If you could choose one or more of these projects and you have a hard budget constraint of $600, which projects would you choose? What is the total NPV achieved? How much of your budget was left unspent?
8) If you could choose one or more of these projects and you have a hard budget constraint of $1,000, which projects would you choose? What is the total NPV achieved? How much of your budget was left unspent?
9) Finally, if the budget remains at $1,000, which projects would you choose where selecting of project B requires the selection of project C? What is the total NPV achieved? How much of your budget was left unspent?

Expected Cash Flows (in $ millions)
Project	Initial Cost	Year 1	Year 2	Year 3	Year 4	Year 5
A	$300	$100	$275	$300	$200	$50
B	$250	$400	$300	$200	$100	$0
C	$350	$50	$200	$50	$200	$50
D	$475	$75	$100	$125	$150	$175
E	$200	$0	$0	$0	$500	$500
F	$150	$50	$50	$50	$50	$50