DO NOT ANSWER IN EXCEL

1. Mangement is considering two hotel projects. Project A will be in Jamaica with an intial investment of $865,000 and Project B will be in Canada with an initial investment of $750,000

Years	Project A	Project B
Year 1 CashFlow	316,000.00	200,000.00
Year 2 CashFlow	350,000.00	200,000.00
Year 3 CashFlow	(20,000.00)	(15,000.00)
Year 4 CashFlow	280,000.00	390,000.00

The cost of capital for Project A is 13% and the cost of capital for project B is 15%. Calculate the following;

1. Calculate the discounted payback period of Project A
2. Calculate the discounted payback period of Project B.
3. Calculate the net present value for Project A
4. Calculate the net present value for Project B.

5. Management can only accept one project. Which project should management accept? Explain your answer