Two programs are being considered for replication in another locale. ABC nonprofit has asked you to analyze both program options and provide a recommendation.

The following data are available:

Program A has an initial investment cost of $100,000 and an additional investment cost in Year 3 of $20,000. Program B has an initial investment cost of

$60,000.

Additional information for the two programs is provided below.

Year 1 Year 2 Year 3 Year 4 Program A Revenue $150,000 $150,000 $150,000 $150,000 Operational Costs $120,000 $130,000 $140,000 $145,000 Program B Revenue $250,000 $250,000 $250,000 $250,000 Operational Costs $250,000 $200,000 $240,000 $230,000

(a) Use Figure 4.1 as a template and perform present value computations using a discount rate of 5%.

(b) Use Figure 4.2 as a guide and calculate the NPV for each program.

(c) Use Figure 4.3 as a guide and calculate the benefit‑ cost ratio for each program.

(d) Use Figure 4.4 as a guide and calculate the IRR for each program.

(e) Use Figure 4.5 as a guide and calculate the DPP for each program.

(f) What other contextual information would be helpful in assisting with a recommendation?
(g) Provide a recommendation to your client.
(h) How can the different analyses computed in (b), (c), (d), and

(e) inform decision making?