The management of Style Networks Inc. is considering two TV show projects. The estimated net cash flows from each project are as follows

Year After Hours Sun Fun

1 435,000 370,000

2 435,000 370,000

3 435,000 370,000

4 435,000 370,000

After Hours requires an investment of $1,507,275 while Sun Fun requires an investment of $957,930. No residual value is expected from either project.

1. Compute the following for EACH project.

a. The net present value. Use a rate of 10% and the present value of an annuity of $1

2.Determine the internal rate of return for each project by (a) computing a present value factor for an annuity of $1 and (b) using the present value of an annuity of $1.