The ABC Company is considering the purchase of the new equipment. It can buy either equipment A or equipment B, so the investment projects are mutually exclusive. Assume that both projects can be repeated indefinitely. Equipment A has an NPV of 20,000 over a 3-year life, and Equipment B has an NPV of 25,000 over a 5-year life. The project types are equally risky, and the firm's cost of capital is 12%.