Net Present Value$-$Unequal Lives

Dakota Mining Company has two competing proposals: a diamond core drill or a hydraulic excavator. Both pieces of equipment have an initial investment of $$720,000.$ The net cash flows estimated for the two proposals are as follows:

Net Cash Flow

Net Cash Flow

Year Diamond Core Drill Hydraulic Excavator

$\backslash$table$[[1,$$$318,000,$$$341,000$

A $,$ B

C

D

E

$Ne$ Present Value$-$Unequal Lives

$2$

$3$ Dakota Mining Company has two competing proposals: a diamond core drill or a hydraulic excavator. The following data is provided:

DATA

$\backslash$table$[[,$Net Cash Flow$],[$Year$,$Diamond Core Drill,Hydraulic Excavator$],[1,$$$318,000,$$$341,000$