The net present value (NPV) method estimates how much a potential project will contribute to -Select- , and it is the best selection criterion. The -Select- the NPV, the more value the project adds; and added value means a -Select-stock price. In equation form, the NPV is defined as: CF CF NPV = CF + CF + +...+ = (1+0)". (1+)" (1+2) " CF tad (1+r) CFt is the expected cash flow at Time t, r is the project's risk-adjusted cost of capital, and N is its life, and cash outflows are treated as negative cash flows. The NPV calculation assumes that cash inflows can be reinvested at the project's risk-adjusted -Select- . When the firm is considering independent projects, if the project's NPV exceeds zero the firm should -Select- v the project. When the firm is considering mutually exclusive projects, the firm should accept the project with the -Select- NPV. Quantitative Problem: Bellinger Industries is considering two projects for inclusion in its capital budget, and you have been asked to do the analysis. Both projects' after-tax cash flows are shown on the time line below. Depreciation, salvage values, net operating working capital requirements, and tax effects are all included i these cash flows. Both projects have 4-year lives, and they have risk characteristics similar to the firm's average project. Bellinger's WACC is 9%. 0 2 4 340 290 Project A Project B -970 -970 610 210 240 390 275 740 What is Project A's NPV? Do not round intermediate calculations. Round your answer to the nearest cent. $ What is Project B's NPV? Do not round intermediate calculations. Round your answer to the nearest cent. $ If the projects were independent, which project(s) would be accepted? -Select- If the projects were mutually exclusive, which project(s) would be accepted? -Select