Labeau Products, Ltd., of Perth, Australia, has $15,000 to invest. The company is trying to decide between two alternative uses for the funds as follows:

	Invest in Project X		Invest in Project Y
Investment required	$	15,000	$	15,000
Annual cash inflows	$	5,000
Single cash inflow at the end of 6 years			$	36,000
Life of the project	6 years		6 years

The companys discount rate is 16%.

Click here to view Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factor(s) using tables.

Required:

	Now	1	2	3	4	5	6
Project X:
Initial investment
Annual cash inflows
Total cash flows
Discount factor (16%)
Present value
Net present value
Project Y:
Intial investment
Single cash inflows
Total cash flows
Discount factor (16%)
Present value
Net present value