Question: Evaluate two investment projects using the net present value (NPV) method. Project A requires an initial investment of $10,000,000 and generates cash flows of $3,000,000

Evaluate two investment projects using the net present value (NPV) method. Project A requires an initial investment of $10,000,000 and generates cash flows of $3,000,000 annually for five years. Project B requires an initial investment of $15,000,000 and generates cash flows of $4,000,000 annually for five years. The discount rate is 10%.

Project

Initial Investment

Cash Flows (Annual)

NPV

Project A

$10,000,000



Project B

$15,000,000



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