Question

Q 1. From the following information, calculate the net present value of the two project and suggest which of the two projects should be accepted.

Particulars	Project X	Project Y
Investment	400,000 dhs	420,000 dhs
Estimated Life	4 years	4 years
Scrap Value	60,000 dhs	70,000 dhs

The cash inflows are as follows:

Project Name	Year 1	Year 2	Year 3	Year 4
Project X	90,000	120,000	140,000	70,000
Project Y	80,000	148,000	98,000	60,000

Note: The following are the present value factors @ 10 % p.a.

Year	1	2	3	4
Factor	0.909	0.826	0.751	0.683

Answer 1