Phoenix Company is considering Investments in projects C1 and C2. Both require an Initial Investment of $282.000 and would yield the following annual net cash flows. PV of $1. FV of $1. PVA of $1. and FVA of $11 (Use appropriate factor(s) from the tables provided.) Net cash flows Project C1 Project C2 Year 1 $ 30,00 $ 114,eee Year 2 126,880 114.ee Year 3 186,880 114, eee Totals $ 342,000 $ 342,eee a. The company requires a 9% return from its Investments. Compute net present values using factors from Table B.1 In Appendix B to determine which projects, if any, should be accepted. b. Using the answer from parta, Is the Internal rate of return higher or lower than 9% for (1) Project C1 and (n) Project C2? Hint: It is not necessary to compute IRR to answer this question. Complete this question by entering your answers in the tabs below. Required A Required B The company requires a 9% return from its investments. Compute net present values using factors from Table B.1 in Appendix B to determine which projects, if any, should be accepted. (Negative net present values should be indicated with a minus sign. Round your present value factor to 4 decimals. Round your answers to the nearest whole dollar.) Present Value of Present Value Project C1 Net Cash Flows of 1 at 9% Net Cash Flows 30.000 x 128.000 x Year 3 188,000 x 342.000 $ Year 1 Year 2 Totals Net Cash Flows X Present Value of 1 at 9% Present Value of Net Cash Flows S $ = Project C2 Year Year 2 Year 3 Totals 198.000 x 78.000 x 68,000 x 342.000 $ Totals s 342.000 Net present value Present value of cash inflows Which projects, any, should be accepted Project C2 Table B.1* Present Value of 1 p=1/(1+1)" Rate Periods 1% 2% 3% 4% 5% 6% 79% 8% 9% 12% 15% Periods 10% 0.9091 1 0.9804 0.9434 0.9259 1 0.9901 0.9803 0.9706 0.9709 0.9426 0.9615 0.9246 2 0.9524 0.9070 0.8638 0.9174 0.8417 0.9612 0.9346 0.8734 0.8163 0.8900 0.8573 0.8264 0.8696 0.7561 0.6575 2 3 0.9423 0.9151 0.8890 0.8396 0.7938 0.7722 3 0.7513 0.6830 4 0.9610 0.9238 0.8885 0.8548 0.8227 0.7921 0.7629 0.7350 0.7084 0.5718 4 0.8929 0.7972 0.7118 0.6355 0.5674 0.5066 0.4523 0.4039 5 0.9515 0.9057 0.8626 0.8219 0.7473 0.7130 0.6806 0.6499 0.6209 0.4972 5 0.7835 0.7462 6 0.9420 0.8880 0.8375 0.7903 0.7050 0.4323 6 7 0.9327 0.8706 0.8131 0.7599 0.7107 0.6651 0.6302 0.5835 0.5403 0.5963 0.5470 0.5019 7 0.3759 0.3269 8 0.9235 0.8535 0.7894 0.7307 0.6768 0.6274 8 0.5645 0.5132 0.4665 0.4241 0.3855 0.3505 9 0.8368 0.6446 0.5919 0.2843 9 0.9143 0.9053 0.8963 10 0.6663 0.6227 0.5820 0.5439 0.5083 0.4751 0.4440 0.4150 0.7664 0.7441 0.7224 0.7026 0.6756 0.6496 0.6139 0.5584 0.8203 0.8043 0.5002 0.4632 0.4289 0.2472 0.3606 0.3220 0.2875 10 11 0.5847 0.4604 0.4224 0.3875 0.3555 0.3262 0.5268 0.2149 11 12 0.8874 0.7014 0.6246 0.3971 0.3186 0.2567 0.1869 12 0.7885 0.7730 0.4970 0.4688 13 0.8787 0.6810 0.6006 0.3677 0.2897 0.2292 0.1625 13 14 0.8700 0.7579 0.6611 0.5775 0.3878 0.2992 0.2633 0.2046 14 0.5568 0.5303 0.5051 0.4810 0.4581 0.4363 0.4423 0.4173 0.3405 0.3152 0.1413 0.1229 15 0.8613 0.7430 0.6419 0.5553 0.2745 0.2394 15 0.1827 0.1631 16 0.8528 0.5339 0.3936 16 0.7284 0.7142 0.7002 0.2519 0.2311 17 0.6232 0.6050 0.5874 0.8444 0.1069 0.0929 0.5134 0.3714 0.2176 0.1978 0.1799 0.1456 0.3624 0.3387 0.3166 0.2959 0.2765 0.2584 17 0.2919 0.2703 0.2502 0.2317 18 0.8360 0.4936 0.3503 18 19 0.1300 0.1161 0.8277 0.6864 0.5703 0.4155 0.3957 0.3769 0.4746 0.2120 0.1945 0.1784 0.3305 0.1635 0.0808 0.0703 0.0611 19 20 0.8195 0.6730 0.4564 0.3118 0.2145 0.1486 0.1037 20 25 0.7798 0.6095 0.5537 0.4776 0.4120 0.3751 0.2330 0.1160 0.0304 25 0.0588 0.0334 30 30 35 40 0.7419 0.7059 0.6717 0.5521 0.5000 0.4529 0.2953 0.2314 0.1813 0.1420 0.3083 0.2534 0.2083 0.1842 0.1314 0.0937 0.0668 0.1741 0.1301 0.0972 0.1460 0.0994 0.0676 0.0460 0.3554 0.0923 0.0573 0.0356 0.0221 0.0754 0.0490 0.0318 0.0151 0.0075 0.0037 0.0189 0.0107 35 0.3066 40 *Used to compute the present value of a known future amount. For example: How much would you need to invest today at 10% compounded semiannually to accumulate $5,000 in 6 years from today? Using the factors of n = 12 and i = 5% (12 semiannual periods and a semiannual rate of 5%), the factor is 0.5568. You would need to invest $2,784 today ($5,000 * 0.5568). = Table B.2 Future Value of 1 f= (1 + 1) Rate 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 12% 15% Periods Periods 0 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 0 1.0000 1.0100 1.0000 1.0600 1.0000 1.0900 1 1.0200 1.0300 1.0400 1.0800 1.1200 1.1500 1 1.0000 1.0700 1.1449 1.2250 2 1.0201 1.0404 1.2544 1.3225 2 1.0609 1.0927 1.1236 1.1910 3 1.0303 1.0612 1.4049 1.5209 1.0816 1.1249 1.1699 1.2167 3 1.0000 1.1000 1.2100 1.3310 1.4641 1.6105 1.7716 1.1664 1.2597 1.3605 1.4693 4 1.0406 1.0824 1.1255 1.2625 1.3108 1.5735 1.0500 1.1025 1.1576 1.2155 1.2763 1.3401 1.4071 1.4775 1.7490 4 5 1.0510 1.1041 1.1593 1.3382 1.1881 1.2950 1.4116 1.5386 1.6771 1.8280 1.9926 1.4026 1.7623 2.0114 5 6 1.0615 1.1262 1.4185 1.5869 2.3131 6 1.1487 1.5036 7 8 1.2653 1.3159 1.3686 1.0721 1.0829 7 1.1941 1.2299 1.2668 1.3048 1.5007 1.6058 1.7182 1.7138 1.8509 8 1.9738 2.2107 2.4760 2.7731 3.1058 1.1717 1.1951 1.2190 9 2.6600 3.0590 3.5179 4.0456 1.4233 1.5938 1.6895 1.7908 1.5513 1.8385 1.9990 1.0937 1.1046 2.1719 9 10 1.3439 1.4802 1.9672 2.1589 1.9487 2.1436 2.3579 2.5937 2.8531 3.1384 3.4523 2.3674 1.6289 1.7103 10 11 1.3842 1.5395 1.8983 2.1049 2.3316 2.5804 3.4785 4.6524 11 1.1157 1.1268 1.2434 1.2682 12 1.4258 1.6010 2.0122 2.5182 2.8127 3.8960 5.3503 12 13 1.1381 1.2936 1.4685 2.7196 3.0658 4.3635 6.1528 13 14 2.2522 2.4098 2.5785 2.7590 1.3195 3.3417 2.1329 2.2609 2.3966 3.7975 4.8871 14 1.1495 1.1610 1.1726 1.7959 1.8856 1.9799 2.0789 2.1829 2.2920 15 1.5126 1.5580 1.6047 1.3459 3.6425 5.4736 15 16 2.5404 2.9522 3.9703 6.1304 1.3728 1.4002 4.1772 4.5950 5.0545 16 2.9372 3.1722 3.4259 3.7000 3.9960 4.3157 1.6651 1.7317 1.8009 1.8730 1.9479 2.0258 2.1068 2.1911 2.6658 7.0757 8.1371 9.3576 10.7613 12.3755 17 1.1843 1.6528 2.6928 4.3276 6.8660 17 1.4282 1.7024 2.4066 2.8543 4.7171 3.1588 3.3799 3.6165 5.5599 7.6900 18 19 20 18 1.1961 1.2081 1.4568 2.5270 3.0256 5.1417 6.1159 8.6128 14.2318 19 1.7535 1.8061 1.2202 1.4859 2.6533 5.6044 9.6463 20 3.2071 4.2919 3.8697 5.4274 4.6610 6.8485 25 1.2824 1.6406 3.3864 8.6231 17.0001 25 2.0938 2.4273 1.3478 1.8114 3.2434 4.3219 5.7435 7.6123 10.0627 30 35 40 6.7275 10.8347 17.4494 28.1024 45.2593 13.2677 20.4140 30 16.3665 32.9190 66.2118 133.1755 267.8635 1.4166 2.8139 3.9461 10.6766 1.9999 2.2080 35 5.5160 7.0400 29.9599 52.7996 93.0510 7.6861 10.2857 14.7853 21.7245 1.4889 3.2620 4.8010 14.9745 31.4094 40 *Used to compute the future value of a known present amount. For example: What is the accumulated value of $3,000 invested today at 8% compounded quarterly for 5 years? Using the factors of n = 20 and i = 2% (20 quarterly periods and a quarterly interest rate of 2%), the factor is 1.4859. The accumulated value is $4,457.70 (53,000 x 1.4859). Table B.3.Present Value of an Annuity of 1 p= [1 - 1/(1 + 2)"] Rate 7% 2% 3% 49 5% 6% 8% 9% 10% 15% P Periods 1 1 2 3 1% 0.9901 1.9704 0.9804 1.9416 0.9615 1.8861 2.7751 0.8696 1.6257 2.2832 4 5 6 7 7 0.9709 1.9135 2.8286 3.7171 4.5797 5.4172 6.2303 7.0197 7.7861 8.5302 9.2526 0.9434 1.8334 2.6730 3.4651 4.2124 4.9173 5.5824 6.2098 3.6299 4.4518 5.2421 6.0021 6.7327 7.4353 2.8839 3.8077 4.7135 5.6014 6.4720 7.3255 8.1622 8.9826 9.7868 10.5753 11.3484 12.1062 12.8493 0.9259 1.7833 2.5771 3.3121 3.9927 4.6229 5.2064 5.7466 6.2469 0.9174 1.7591 2.5313 3.2397 3.8897 4.4859 5.0330 5.5348 5.9952 12% 0.8929 1.6901 2.4018 3.0373 3.6048 4.1114 4.5638 4.9676 0.9346 1.8080 2.6243 3.3872 4.1002 4.7665 5.3893 5.9713 6.5152 7.0236 7.4987 7.9427 8.3577 8.7455 9.1079 8 9 0.9091 1.7355 2.4869 3.1699 3.7908 4.3553 4.8684 5.3349 5.7590 6.1446 6.4951 5.3282 0.9524 1.8594 2.7232 3.5460 4.3295 5.0757 5.7864 6.4632 7.1078 7.7217 8.3064 8.8633 9.3936 9.8986 10.3797 10.8378 11.2741 11.6896 12.0853 12.4622 14.0939 10 11 12 13 14 2.9410 3.9020 4.8534 5.7955 6.7282 7.6517 8.5660 9.4713 10.3676 11.2551 12.1337 13.0037 13.8651 14.7179 15.5623 16.3983 17.2260 18.0456 22.0232 25.8077 29.4086 32.8347 8.1109 8.7605 9.3851 9.9856 2.8550 3.3522 3.7845 4.1604 4.4873 4.7716 5.0188 5.2337 5.4206 5.5831 5.7245 5.8474 6.7101 7.1390 7.5361 6.4177 6.8052 7.1607 6.8017 7.3601 7.8869 8.3838 8.8527 9.2950 9.7122 10.1059 10.4773 10.8276 11.1581 11.4699 7.9038 8.2442 8.5595 7.4869 7.7862 8.0607 9.9540 10.6350 11.2961 11.9379 12.5611 13.1661 13.7535 14.3238 15 10.5631 11.1184 11.6523 12.1657 12.6593 13.1339 13.5903 15.6221 17.2920 18.6646 19.7928 16 17 18 19 20 25 30 35 40 5.6502 5.9377 6.1944 6.4235 6.6282 6.8109 6.9740 7.1196 7.2497 7.3658 7.4694 7.8431 13.5777 14.2919 14.9920 15.6785 16.3514 19.3235 9.4466 9.7632 10.0591 10.3356 10.5940 11.6536 8.8514 9.1216 9.3719 9.6036 9.8181 10.6748 6.8137 7.1034 7.3667 7.6061 7.8237 8.0216 8.2014 8.3649 8.5136 9.0770 8.3126 8.5436 8.7556 8.9501 9.1285 9.8226 14.8775 17.4131 5.9542 6.0472 6.1280 6.1982 6.2593 6.4641 6.5660 6.6166 6.6418 22.3965 24.9986 27.3555 19.6004 21.4872 23.1148 15.3725 16.3742 17.1591 12.7834 13.7648 14.4982 15.0463 12.4090 12.9477 13.3317 11.2578 11.6546 11.9246 10.2737 10.5668 10.7574 9.4269 9.6442 9.7791 8.0552 8.1755 8.2438 Used to calculate the present value of a series of equal payments made at the end of each period. For example: What is the present value of $2.000 per year for 10 years assuming an aronual interest rate of 0%? For (n = 10, i = 9%), the PV factor is 6.4177. $2,000 per year for 10 years is the equivalent of $12,835 today ($2.000 6.4177). x Table B.4 Future Value of an Annuity of f=[(1 + )" - 13/1 P Rate Periods 1% 2% 3% 4% 5% 6% 7% 7 8% 9% 10% 12% 15% 1 1 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 2 2.0100 2.0200 2.0300 2.0400 2.0500 2.0600 2.0700 2.0800 2.0900 2.1000 2.1200 2.1500 3 3.0301 3.0604 3.0909 3.1216 3.1525 3.1836 3.2149 3.2464 3.2781 3.3100 3.3744 3.4725 4 4.0604 4.1216 4.1836 4.2465 4.3101 4.3746 4.4399 4.5061 4.5731 4.6410 4.7793 4.9934 5 5.1010 5.2040 5.3091 5.4163 5.5256 5.6371 5.7507 5.8666 5.9847 6.1051 6.3528 6.7424 6 6.1520 6.3081 6.4684 6.6330 6.8019 6.9753 7.1533 7.3359 7.5233 7.7156 8.1152 8.7537 7 7.2135 7.4343 7.6625 7.8983 8.1420 8.3938 8.6540 8.9228 9.2004 9.4872 10.0890 11.0668 8 8.2857 8.5830 8.8923 9.2142 9.5491 9.8975 10.2598 10.6366 11.0285 11.4359 12.2997 13.7268 9 9.3685 9.7546 10.1591 10.5828 11.0266 11.4913 11.9780 12.4876 13.0210 13.5795 14.7757 16.7858 10 10.4622 10.9497 11.4639 12.0061 12.5779 13.1808 13.8164 14.4866 15.1929 15.9374 17.5487 20.3037 11 11.5668 12.1687 12.8078 13.4864 14.2068 14.9716 15.7836 16.6455 17. 3603 18.5312 20.6546 24.3493 12 12.6825 13.4121 14.1920 15.0258 15.9171 16.8699 17.8885 18.9771 20.1407 21.3843 24.1331 29.0017 13 13.8093 14.6803 15.6178 16.6268 17.7130 18.8821 20.1406 21.4953 22.9534 24.5227 28.0291 34.3519 14 14.9474 15.9739 17.0863 18.2919 19.5986 21.0151 24.2149 26.0192 27.9750 32.3926 40.5047 15 16.0969 17.2934 18.5989 20.0236 21.5786 23.2760 25.1290 27.1521 29.3609 31.7725 37.2797 47.5804 16 172579 18.6393 20.1369 21.8245 23.6575 25.6725 27.8881 30.3243 33.0034 35.9497 42.7533 55.7175 17 18.4304 20.0121 21.7616 23.6975 25.8404 28.2129 30.8402 33.7502 36.9737 40.5447 48.8837 65.0751 18 19.6147 21.4123 23.4144 25.6454 28.1324 30.9057 33.9990 37.4502 41.3013 45.5992 55.7497 75.8364 19 20.8109 22.8406 25.1169 27.6712 30.5390 33.7600 37.3790 41.4463 46.0185 51.1591 63.4397 88.2118 20 22.0190 24.2974 26.8704 29.7781 33.0660 36.7856 40.9955 45.7620 51.1601 57.2750 72.0524 102.4436 25 28.2432 32.0303 36.4593 41.6459 47.7271 54.8645 63.2490 73.1059 84.7009 98.3471 133.3339 212.7930 30 34.7849 40.5681 47.5754 56.0849 66.4388 79.0582 94.4608 113.2832 136.3075 164.4940 241.3327 434.7451 35 41.6603 49.9945 60.4621 73.6522 90.3203 111.4348 138.2369 172.3168 215.7108 271.0244 | 431.6635 881.1702 40 48.8864 60.4020 75.4013 95.0255 120.7998 154.7620 199.6351 199.6351 259.0565 337.8824 442.5926 767.0914 1,779.0903 Used to calculate the future value of a series of equal pquments made at the end of each period For example: What is the future value of $4.000 per year for 6 years assuming an annual interest rate of 8%? For (n = 0, i = 3%), the FV factor is 7.3350. 4,000 per year for 6 years accumulates to $29.343.60 (54.000 x 7.3359). 22.5505