Your company is considering starting a new project in either Spain or Ukrainethese projects are mutually exclusive, so your boss has asked you to analyze the projects and then tell her which project will create more value for the companys stockholders. The Spanish project is a six-year project that is expected to produce the following cash flows: Project: Spanish Year 0: $1,120,000 Year 1: $370,000 Year 2: $390,000 Year 3: $420,000 Year 4: $330,000 Year 5: $220,000 Year 6: $95,000 The Ukrainian project is only a three-year project; however, your company plans to repeat the project after three years. The Ukrainian project is expected to produce the following cash flows: Project: Ukrainian Year 0: $490,000 Year 1: $250,000 Year 2: $265,000 Year 3: $275,000 Because the projects have unequal lives, you have decided to use the replacement chain approach to evaluate them. You have determined that the appropriate cost of capital for both projects is 11%. Assuming that the Ukrainian projects cost and annual cash inflows do not change when the project is repeated in three years and that the cost of capital remains at 11%, answer the following questions:

The NPV of the Spanish project is: $188,558 $259,268 $235,698 $223,913

The NPV of the Ukrainian project is: $235,866 $288,280 $314,488 $262,073