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Problem 1 of 3 Assume a company is going to make an investment of $400,000 in a machine and the following are the cash
Problem 1 of 3 Assume a company is going to make an investment of $400,000 in a machine and the following are the cash flows that two different products would bring in years one through four. For each of the two options calculate the payback, IRR, and NPV. Assume that you require a 10% rate of return on all investments. To complete the NPV calculation you will need to add the initial investment in year zero (hint: Excel expects investments/outflows of cash as negative numbers and inflows of cash as positive numbers). Record your responses in the grey cells below (show your work in calculations). Option A, Option B, Year Product A Product B 0 1 210,000 160,000 2 190,000 170,000 3 50,000 70,000 4 10,000 100,000 Payback= IRR= NPV=
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