Question

Here are the cash-flow forecasts for two mutually exclusive projects: Cash Flows (dollars) Year Project A...

Here are the cash-flow forecasts for two mutually exclusive projects:

Cash Flows (dollars)
Year Project A Project B
0 120 120
1 50 69
2 70 69
3 90 69

a-1. What is the NPV of each project if the opportunity cost of capital is 2%? (Do not round intermediate calculations. Round your answers to 2 decimal places.)

a-2. Which project would you choose?

b-1. What is the NPV of each project if the opportunity cost of capital is 14%? (Do not round intermediate calculations. Round your answers to 2 decimal places.)

b-2. Which would you choose?

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