The net present value $($NPV$)$ method estimates how much a potential project will contribute to

$($a$.$

$,$ and it is the best selection criterion. The larger

$()$ NPV$,$ the more value the project adds; and added value means a

stock price. In equation form, the NPV is defined as:

$NPV=C{F}_0+\frac{C{F}_1}{(1+r{)}^1}+\frac{C{F}_2}{(1+r{)}^2}+$dots$+\frac{C{F}_H}{(1+r{)}^N}={\displaystyle \underset{t=0}{\overset{N}{}}}\frac{C{F}_t}{(1+r{)}^t}$

exceeds zero the firm should

the project. When the firm is considering mutually exclusive projects, the firm should accept the project with the

highest positive $Y$

NPV$.$

flows. Both projects have $4-$year lives, and they have risk characteristics similar to the firm's average project, Bellinger's WACC is $7\%.$

What is Project A$\text{'}$s NPV$?$ Do not round intermediate calculations. Round your answer to the nearest cent.

$

$3$

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What is Project B$\text{'}$s NPV$?$ Do not round intermediate calculations. Round your answer to the nearest cent.

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