Current	Alternative
	Proposal	Proposal
Initial Outlay	10,000,000	7,000,000
Earnings Before Interest and Tax (end of Y1)	1,500,000	1,100,000
Corporate Tax Rate	28%	28%
Depreciation & Amortization	1,000,000	700,000
Change in Current Assets	100,000	50,000
Change in Current Liabilities	70,000	35,000
Salvage Value	Nil	Nil

Additional information
Discount Rate (reflecting the riskiness in the A/C industry)	9%
New Zealand 10 Year Government Bond	4.38%
Variance of share returns (on renovation industry in NZ)	36%
Decay rate*	2.71828
Can be assumed as equal in each year throughout the life
of the project

1. With the uses of Excel, calculate the worth of each alternative accordingly.

2. At what Exit price would the two alternatives be identical in their worths