Question: Future Tech Ventures is deciding between two high-tech projects. The required return is 11%. Year Project Alpha Project Beta 0 $(95,000) $(110,000) 1 $25,000 $28,000

Future Tech Ventures is deciding between two high-tech projects. The required return is 11%.

Year

Project Alpha

Project Beta

0

$(95,000)

$(110,000)

1

$25,000

$28,000

2

$30,000

$35,000

3

$35,000

$40,000

4

$40,000

$45,000

a. Compute the payback period for each project. Which project is preferable based on this criterion?

b. Calculate the net present value for each project. Which project should be selected based on the NPV?

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