Net Present Value Method, Internal Rate of Return Method, and Analysis The management of Advanced Alternative Power Inc. is considering two capital investment projects. The estimated net cash flows from each project are as follows Year 1 2 3 4 Wind Turbines Biofuel Equipment $280,000 $300,000 280,000 300,000 280,000 300,00 280,000 300,000 The wind turbines require an investment of $887,600, while the biofuel equipment requires an investment of $911,100. No residual value is expected from either project Present Value of an Annuity of $1 at Compound Interest Year 6% 10% 12% 15% 20% 1 0.943 0.909 0.893 0.870 0.833 2 1.833 1.736 1.690 1.626 1.528 3 2.673 2.487 2.402 2.283 2.106 4 3.465 3.170 3.037 2.855 2.589 5 4.212 3.791 3.605 3.353 2.991 6 4.917 4.355 4.111 3.785 3.326 7 5.582 4.868 4.564 4.160 3.605 A 6.210 4.487 4.968 5.335 3.837 a. Compute the net present value for each project. Use a rate of 6% and the present value of an annuity of $1 in the table above. If required, round to the nearest Bollar. Wind Turbines Bio Fuel Equipment Present value of annual net cash flows Less amount to be invested Net present value 887,600 911,100 1b. Compute a present value index for each project. If required, round your answers to two decimal places. Wind Turbines Bio Fuel Equipment Present Value Index 2. Determine the internal rate of return for each project by (a) computing a present value factor for an annuity of $1 and (b) using the present value of an annuity of $1 in the table above. If required, round your present value factor answers to three decimal places and internal rate of return to the nearest percent Present value factor for an annuity of $1 Internal rate of return Wind Turbines 10 % Bio Fuel Equipment 12 % 3. The net present value, present value index, and internal rate of return all indicate that the bio fuel equipment is/are a better financial opportunity compared to the wind turbine ot although both investments.meet the um criterion of Check My Work Previous