Question 1

The NVP of project kelvin is $___ ( round to the nearest cent)

The NVP of project Thompson is $______ ( round to the nearest cent)

NPV for varying costs of capital LePew Cosmetics is evaluating a new fragrance-mixing machine. The machine requires an initial investment of $340,000 and will generate after-tax cash inflows of $63,450 per year for 8 years. If the cost of capital is 14%, calculate the net present value (NPV) and indicate whether to accept or reject the machine. The NPV of the project is $. (Round to the nearest cent.)Axis Corp. is considering an investment in the best of two mutually exclusive projects. Project Kelvin involves an overhaul of the existing system; it will cost $0 and generate cash inflows of $10,000 per year for the next 3 years. Project Thompson involves replacement of the existing system; it will cost $270,000 and generate cash inflows of $60,000 per year for 6 years. Using a(n) 8.57% cost of capital, calculate each project's NPV, and make a recommendation based on your findings