Keller Construction is considering two new investments. Project E calls for the purchase of earth moving equipment. Project H represents an investment in a hydraulic lift. Keller wishes to use a net present value profile in comparing the projects. The investment and cash flow patterns are as follows: Use Appendix B.

Project E				Project H
($40,000 investment)				($36,000 investment)
Year	Cash flow			Year	Cash flow
1		$ 9,000		1		$ 17,000
2		14,000		2		15,000
3		20,000		3		13,000
4		22,000

(a) Determine the net present value of the projects based on a zero discount rate. (Omit the "$" sign in your response.) Net present value Project E $ Project H $

(b) Determine the net present value of the projects based on a 11 percent discount rate. (Round "PV Factors" to 3 decimal places and final answer to the nearest dollar amount. Omit the "$" sign in your response.) Net present value Project E $ Project H $

(d) If the two projects are not mutually exclusive, what would your acceptance or rejection decision be if the cost of capital (discount rate) is 8 percent? (Use the net present value profile for your decision; no actual numbers are necessary.) Project E Project H Both H and E