Present Value of an Annuity of $1 at Compound Interest 1. For each project, compute the net present value. Use the present value of an annuity of $1 table above. Ignore the unequal lives of the projects. If required, round to the nearest dollar. 2. For each project, compute the net present value, assuming that the office expansion is adjusted to a 4-year life for purposes of analysis. Use the present value of toble above. If required, round to the nearest dollar. 3. The net present value of the two projects over equal ives indicates that the has a higher net present value and would be a superior investment. Alternative Captal Investments The investment commitee of Sentry Insurance Co. is evaluating two projects, office exponsion and upgrade to computer servers. The projects have different useful lives, but each requires an investment of $490,000. The estimated net cash flows from each project are as follows: The committee has selected a rate of 12% for purposes of net present value analvss. It ako estimates that the residual value at the end of each project's useful ife is 30, but at the end of the fourth year, the office expansion's residual value would be $180,000. Present Value of an Annuity of $1 at Compound Interest 1. For each project, compute the net present value. Use the present value of an annuity of $1 table above. Ignore the unequal lives of the projects. If required, round to the nearest dollar. 2. For each project, compute the net present value, assuming that the office expansion is adjusted to a 4-year life for purposes of analysis. Use the present value of toble above. If required, round to the nearest dollar. 3. The net present value of the two projects over equal ives indicates that the has a higher net present value and would be a superior investment. Alternative Captal Investments The investment commitee of Sentry Insurance Co. is evaluating two projects, office exponsion and upgrade to computer servers. The projects have different useful lives, but each requires an investment of $490,000. The estimated net cash flows from each project are as follows: The committee has selected a rate of 12% for purposes of net present value analvss. It ako estimates that the residual value at the end of each project's useful ife is 30, but at the end of the fourth year, the office expansion's residual value would be $180,000