Peter Campbell plans to invest in real estate income property. He plans to hold that property for 7 years. He is considering two income properties, A and B.

Their initial investment, cash flows, standard deviations of cash flows, and resale values are as follows.

Use Microsoft Excel to calculate the NPV and σ_NPV of each property. (Assume a discount rate of 12 %.)According to the results, which property should Peter choose?

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Property A (in thousands of dollars) Year 0 1 2 3 4 5 6 7 7 234sort Property B (in thousands of dollars) Year 0 1 5 6 7 Cash Flow -60 18 18 7 18 18 18 18 18 400 (resale value) Cash Flow -60 18 18 18 18 18 18 18 400 (resale value) Standard deviation 0 1 1.1 1.3 1.4 1.5 1.7 1.9 0 Standard deviation 0 .9 1.1 1.4 1.5 1.6 1.8 1.9 0