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Keller Construction is considering two new investments. Project E calls for the purchase of earthmoving equipment. Project H. represents an investment in a hydraulic lift.
Keller Construction is considering two new investments. Project E calls for the purchase of earthmoving 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 for an approximate answer but calculate your final answer using the formula and financial calculator methods. Year Project E ($49,000 Investment) Cash Flow $11,000 15,000 25,000 32,000 Project H ($46,000 Investment) Year Cash Flow $25,000 18,000 16,000 a. Determine the net present value of the projects based on a zero percent discount rate. Net Present Value Project E Project H b. Determine the net present value of the projects based on a discount rate of 9 percent. (Do not round intermediate calculations and round your answers to 2 decimal places.) Net Present Value Project E Project H
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