Year Wind Turbines Biofuel Equipment 1 $280,000 $300,000 2 |280,000 300,000 3 280.000 300.000 4 280.000 300,000

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"Consider the following two mutually-exclusive altematives: Project Alternatives n Project A1 Cash Flows Project A2 Cash Flows 0-514,000 1+$4,000 - $17,000 $21,000 2- 54,000 3-$12,000 If MARR=15% and assuming indefinite required service and repeatability, use the incremental NPV and IRR analyses in parts (a) and (b) of the problem, respectively, to choose the project in part (c). Please note that project alternatives A7 and A2 have different lives, namely three years for A1 and one year for A2. The alternatives should be compared over the same period, so project A2 will have to be repeated twice." axThe Net Present Value of the incremental investment is: YbrThe rternal Rate of Retun of the incremental investment is: (oWe shoulo choose project alternative: Note: Please enrer your onswvers to two decimal places. If using the interest factor method, apply the value of the factor os presented in the table or spreocsheet (with all four decimal places).

The answer is project B but please answer why that is the correct answer. Engineering economic question

ZLIK Inc is considering methods by which to evaluate a multi-year project that requires a large $55 million investment.  Assuming the project has conventional cash flows, under which conditions would the project be an acceptable investment for ZLIK? Select all that apply. A) NPV < 0 B) NPV > 0 C) IRR > firm's required return D) IRR < firm's required return E) Profitability Index > 1.0 F) Profitability Index < 1.0

The management of Revco Products is exploring four different investment opportunities. Information on the four projects under study follows: Project Number 1 2 3 4 Investment required $ (270,000) $ (450,000) S (360,000) $ (480,000) Present value of cash inflows 336, 140 522,970 433, 400 567, 270 Net present value $ 66, 140 $ 72,970 $ 73,400 $ 87,270 Life of the project 6 years 3 years 12 years 6 years Internal rate of return 18% 19% 14% 16% The net present values above have been computed using a 10% discount rate. Limited funds are available for investment, so the company can't accept all of the available projects. Required: Compute the profitability index for each investment project. Rank the four projects according to preference, in terms of net present value, profitability index, and internal rate of return.

Net present value method, internal rate of return method, and analysis for a service company The management of Advanced Alternative Power Inc. is considering two capital investment projects. The estimated net cash flows from each project are as follows: Year Wind Turbines Biofuel Equipment 1 $230,000 $410,000 2 230,000 410,000 3 230,000 410,000 4 230,000 410,000   The wind turbines require an investment of $698,510, while the biofuel equipment requires an investment of $1,170,550. No residual value is expected from either project. Year 6% 10% 12% 15% 20% 1 0.943 0.909 0.893 0.870 0.833 2 1.833 1.736 1.690 1.626 1.528 3 2.673 2.487 2.402 2.283 2.106 4 3.465 3.170 3.037 2.855 2.589 5 4.212 3.791 3.605 3.353 2.991 6 4.917 4.355 4.111 3.785 3.326 7 5.582 4.868 4.564 4.160 3.605 8 6.210 5.335 4.968 4.487 3.837 9 6.802 5.759 5.328 4.772 4.031 10 7.360 6.145 5.650 5.019 4.192 Required: 1a.  Compute the net present value for each project. Use a rate of…

Financial Manager of Timmy Company is considering two projects (project A and project H), which have cash flows as follows:   Year Cash Flow of Project A (in $) Cash Flow of Project H (in $) 0   -100   -100 1     10     70 2     60     50 3     80     20   Timmy Company’s cost of capital is 10 percent.   Calculate payback, NPV, IRR, and MIRR for both projects. (Please have a step by step format to your answer with explainations. Thanks (=)