Question: 1. Suppose two competing projects have the following net values for each year: Year A B 0 -100000 -110,000 1 60000 0 2 50000 20000

1. Suppose two competing projects have the following net values for

1. Suppose two competing projects have the following net values for each year: Year A B 0 -100000 -110,000 1 60000 0 2 50000 20000 3 40000 40000 4 30000 60000 5 0 80000 Calculate the NPV for each project at a 5% discount rate. Calculate the NPV for each at a 1% discount rate. At what discount rate are the NPVs equal? (to the 1st decimal, ie X.X%) If the discount rate you were asked to use just happened to be this one where the NPVs are equal, which project would you recommend and why? (show your work if you want partial credit, Numerical work + 100-200 words)

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