The following data pertain to an investment proposal: Annual cost savings Cost of the Investment $46,000 $14,000 Estimated salvage value $5,000 5 years 12% Life of the project Discount rate Present value of $1: EXHIBIT 11B-1 Present Value of $1; (1+r) Perlods 4% 5% 6% 7% 8% 9% 10% 11% 12% 13% 1 0.962 0.952 0.943 0.935 0.926 0.917 0.909 0.901 0.893 0.885 0.925 0.907 0.890 0.873 0.857 0.842 0.826 0.812 0.797 0.783 0.889 0.864 0.840 0.816 0.794 0.772 0.751 0.731 0.712 0.693 0.855 0.823 0.792 0.763 0.735 0.708 0.683 0.659 0.636 0.613 5 0.822 0.784 0.747 0.713 0.681 0.650 0.621 0.593 0.567 0.543 2346 0.790 0.746 0.705 0.666 0.630 0.596 0.564 0.535 0.507 0.480 7 0.760 0.711 0.665 0.623 0.583 0.547 0.513 0.482 0.452 0.425 0.731 0.677 0.627 0.582 0.540 0.502 0.467 0.434 0.404 0.376 0.703 0.645 0.592 0.544 0.500 0.460 0.424 0.391 0.361 0.333 10 0.676 0.614 0.558 0.508 0.463 0.422 0.386 0.352 0.322 0.295 68449 EXHIBIT 11B-2 Present Value of an Annuity of $1 in Arrears; [1] Periods 4% 5% 6% 7% 8% 9% 1 2 345 819 0.962 0.952 0.943 1.886 1.859 1.833 2.775 2.723 2.673 3.630 3.546 3.465 3.387 4.452 4.329 4.212 4.100 0.935 0.926 1.808 1.783 2.624 2.577 3.312 3.993 10% 11% 12% 13% 0.917 0.909 0.901 0.893 0.885 1.759 1.736 1.713 1.690 1.668 2.531 2.487 2.444 2.402 2.361 3.240 3.170 3.102 3.037 2.974 3.890 3.791 3.696 3.605 3.517 5.242 5.076 4.917 4.767 4.623 6.002 5.786 5.582 5.389 5.206 4.486 4.355 4.231 4.111 3.998 5.033 4.868 4.712 4.564 4.423 6.733 6.463 6.210 5.971 5.747 9 7.435 7.108 6.802 6.515 6.247 5.535 5.335 5.146 4.968 4.799 5.995 5.759 5.537 5.328 5.132 110 8.111 7.722 7.360 7.024 6.710 6.418 6.145 5.889 5.650 5.426 The net present value of the proposed investment is closest to: 4,470 7,305