Lion Enterprises Inc. is evaluating 3 investment alternatives. Each alternative requires a cash outflow of $102,000. The cash inflows are summarized below (ignore taxes):

Project A Project B Project C

Year 1 $55000 $30000 $0

Year 2 $40000 $30000 $0

Year 3 $20000 $30000 $45000

Year 4 $5000 $30000 $55000

Year $2000 $30000 $65000

The company has a required rate of return of 9%.

Required:

Evaluate and rank each alternative using net present value (NPV).

ANSWER FOR QUESTION 4