Consider two mutually exclusive new product launch projects that Nagano Golf is considering. Assume the discount rate for Nagano Golf is 12 percent.

Project A:

Nagano NP-30.

Professional clubs that will take an initial investment of $630,000 at time 0.

Next five years (Years 15) of sales will generate a consistent cash flow of $265,000 per year.

Introduction of new product at Year 6 will terminate further cash flows from this project

Project B:

Nagano NX-20.

High-end amateur clubs that will take an initial investment of $600,000 at Time 0.

Cash flow at Year 1 is $180,000. In each subsequent year cash flow will grow at 10 percent per year.

Introduction of new product at Year 6 will terminate further cash flows from this project

year	NP-30	NX-20
0	-630,000	-600,000
1	265,000	180,000
2	265,000	198,000
3	265,000	217,800
4	265,000	239,580
5	265,000	263,538

SOLVE:

	NP-30	NX-20
PAYBACK	?? YEARS	?? YEARS
IRR	?? %	?? %
PI
NPV	$ ??	$ ??