Question: Use the NPV method to determine whether Stenback Products should invest in the following projects: Project A: Costs $295,000 and offers seven annual net cash

Use the NPV method to determine whether Stenback Products should invest in the following projects: Project A: Costs $295,000 and offers seven annual net cash inflows of $52,000, Stenback Products requires an annual return of 12% on investments of this nature, Projecte: Costs $385,000 and offers 10 annual net cash inflows of $72,000. Stenback Products demands an annual return of 10% on investments of this nature. (Click the icon to view Present Value of $1 table.) Click the icon to view Present Value of Ordinary Annuity of $1 table.) Read the requirements Requiremont 1. What in the NPV of each project? Assume neither project has a residual values, Round to two decimal places. (Enter any factor amounts to three decimal places, XXXX. Use parentheses or a minus sign for a negative net present value) Caciulate tho NPV (not present value) of each project. Begin by calculating the NPV of Project A. Project A: Net Cash Annuity PV Factor (I-12%, n7) Present value of annuity Present Value Years Inflow 1-7 0 Investment Net present value of Project A Requirements 1. What is the NPV of each project? Assume neither project has a residual value. Round to two decimal places. 2. What is the maximum acceptable price to pay for each project? 3. What is the profitability index of each project? Round to two decimal places
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