Ouestion Hel Use the NPV method to determine whether Smith Products should invest in the following projects Project A Costs $265.000 and offersight annual net cash flows of $56,000 Smith Products requires an annual return of 14% on investments of this nature Project Costs $390.000 and offers 10 annual net cash flows of 575.000. Smith Products demands an annual return of 12% on investments of this nature (Click the icon to view Present Value of $1 table) Click the ken to view Present Value of Ordinary Annuity of 51 table) Read the requirement Requirement 1. What is the NPV of each project? Assume nether project has a residual valun Round to ho decimal placm. (Enter any factor amounts to decimal places, XXXX U14 peentheses or a minun sign for negative nel present value Caculate the NPV (nel present Value of each project Begin by calculating the NPV of Project Project: Net Cash Annuity PV Factor Present Years Inflow (-14% -3) Value Prestany Invest Netrvalued - X Reference Present Value of $1 Periods 6% 19 1 2 3 4 5 1% 0.990 0.980 0.971 0.961 0.951 3% 0.971 0.943 0.915 0 888 0.863 4% 0.962 0.925 0.889 0.855 0.822 0943 0.890 0.840 0.792 0.747 7% 0.935 0.873 0.816 0.763 0.713 12% 0.893 0.797 0.712 0.636 0.567 10% 0.909 0.826 0.751 0.683 0.621 14% 0.877 0.769 0.675 0.592 0.519 2% 0.980 0.961 0.942 0.924 0.906 0.888 0.871 0.853 0.837 0.820 16% 0862 0.743 0.641 0.552 0.476 18% 0.847 0.718 0.609 0516 0.437 5% 0.952 0.907 0.864 0.823 0.784 0.746 0.711 0.677 0.645 0614 20% 0.833 0 694 0.579 0.482 0.402 US 6 7 8 9 10 0.942 0.933 0.923 0.914 0.905 0.837 0.813 0.789 0.766 0.744 0.790 0.750 0.731 0.703 0676 8% 0.925 0.857 0.794 0.735 0.681 0630 0.583 0540 0.500 0463 0429 0.397 0.368 0.340 0.315 0.564 0.513 0.467 0.424 0.386 9% 0.917 0.842 0.772 0.70B 0.650 0.596 0.547 0.502 0.460 0.422 0.388 0.356 0.326 0299 0275 0.335 0.279 0.233 0.507 0.452 0.404 0.361 0.322 0.410 0.354 0.305 0.263 0.227 0.370 0.314 0.266 0.225 0.191 15% 0.870 0.756 0.658 0.572 0.497 0.432 0.376 0.327 0.284 0.247 0.215 0.187 0.163 0.141 0.123 0194 0.162 0.456 0.400 0.351 0.308 0270 0.237 0208 0.182 0.160 0.140 11 12 13 14 15 0.896 0.887 0.879 0.870 0861 0.705 0.665 0.627 0.592 0.558 0527 0.497 0.469 0.442 0.417 0 394 0 371 0.804 0.788 0.773 0.758 0.743 0.728 0.714 0.666 0.623 0.582 0.544 0.508 0.475 0.444 0415 0388 0.362 0339 0317 0.722 0.701 0681 0.661 0.642 0.650 0.625 0.601 0.577 0.556 0.534 0.513 0.585 0.557 0.530 0.505 0.481 0.350 0.319 0.290 0.263 0 239 0218 0.198 0.287 0.257 0229 0.205 0.183 0.163 0.146 0.195 0.168 0.145 0.125 0.108 0.162 0.137 0.116 0.099 0.084 0.071 0060 0.135 0.112 0.093 0.078 0.055 0.107 16 17 0853 0.844 0.623 0.605 0.458 0.436 0292 0270 0.252 0231 0.123 0.108 0.093 0.080 0.054 0.045 0.093 Print Done X i Reference 0078 14 15 0.870 051 0.758 0743 0.66] 0642 057 0555 0.505 0.48] 0442 0417 0.388 0.362 0.340 0315 0209 0275 0 160 0 140 0.141 0123 0125 0108 0.009 0034 0 065 16 17 18 9 20 0.853 0.844 08.36 0828 0820 0.728 0714 0.700 0686 0673 0.623 0605 0587 0570 0554 0534 0513 0494 0475 0456 0458 04.36 0416 0306 0377 0.304 0371 0.350 0331 0312 0330 0317 0296 0277 0256 0292 0270 0.250 0232 0215 0.252 0231 0212 0.194 0 178 0.263 02399 0218 0198 0.180 0 164 0.149 0.135 0123 0 112 0 102 0 092 0205 013 0 163 046 0.130 0 116 004 0123 0 108 0006 0023 0073 0 093 0000 0069 0060 0051 0071 0.060 006] 0043 0.037 0054 1045 0038 0031 0.026 0.107 0093 0041 0070 0.06] 0 063 0046 0.040 0035 0000 21 22 23 24 25 0811 0803 0795 0788 0.780 0660 0647 0634 062 0610 05.B 0.522 0507 0492 0478 0.439 0422 0 406 0.390 037 0369 0342 0326 0310 0.295 0242 0226 0211 0197 0.184 004 0 150 01.36 0126 0.11 0003 0063 0074 0066 0.059 00EA 0.056 006 0043 0.036 0 03 0026 0022 0019 0010 0294 0278 0262 0247 02.33 0220 0207 016 0.185 0 174 0044 0.038 0.033 0.028 0.024 0.021 0018 0016 0014 0012 26 27 28 20 30 0772 0764 0757 0749 0742 0464 0450 0437 0424 0.412 0.596 0.586 0.574 0563 0562 0361 03 0333 0321 0303 0281 0268 0266 0243 0231 0.142 0199 0 194 0170 0 158 0.146 0 136 0925 0 116 0107 009 0046 1172 0 161 0 150 01 03 006 0 098 0090 0.002 0.075 0084 0.076 0060 0063 0057 0.053 0.047 0042 0037 0.033 0022 0018 0016 0013 1010 0.009 0.007 0006 0.006 0.004 0.001 0000 0029 0.026 0022 0.020 0026 0.023 0020 0.017 0015 0014 0.011 0010 0.008 0.007 A0 0672 0453 0.307 0208 0007 0067 002 0022 0004 0011 0005 0003 0.00] 51 0372 0608 0223 04 0027 006 1024 0021 001 0000 0003 0.00] 0001 0.001 i Requirements -X ecin 1. What is the NPV of each project? Assume neither project has a residual value. Round to two decimal places. 2. What is the maximum acceptable price to pay for each project? 3. What is the profitability index of each project? Round to two decimal places. Print Done