The table below provides the estimated end-of-year net cash flows that would be received from alternative projects Red and Blue for an investment of $200,000.

	Year 1	Year 2	Year 3	Year 4
Project Red	$90,000	$80,000	$70,000	$60,000
Project Blue	$40,000	$60,000	$80,000	$130,000

(a)	Find the NPV of each project if the cost of capital is 4.5%.

(b)	In part (a), which project is better?

(c)	Find the NPV of each project if the cost of capital is 6.5%.

(d)	In part (c), which project is better?

Problem #1(a):

NPV of Projects Red and Blue (in that order), separated with a comma. Answers correct to 2 decimals.

(A) Project Red (B) Project Blue Problem #1(b):

Select A B

Problem #1(c):

NPV of Projects Red and Blue (in that order), separated with a comma. Answers correct to 2 decimals.

(A) Project Blue (B) Project Red Problem #1(d):

Select A B