Use the NPV method to determine whether TeeJayTeeJay Products should invest in the following$$ projects:

bullet$$

Project A$$: Costs $ $260$ comma $000$$$260,000$ and offers $77$ annual net cash inflows of $ $57$ comma $000$$$57,000.$ TeeJayTeeJay Products requires an annual return of $1616\%$ on investments of this nature.

bullet$$

Project B$$: Costs $ $375$ comma $000$$$375,000$ and offers $1010$ annual net cash inflows of $ $75$ comma $000$$$75,000.$ TeeJayTeeJay Products demands an annual return of $1414\%$ on investments of this nature.

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Part $1$

Requirement $1.$ What is the NPV of each$$ project? Assume neither project has a residual value. Round to two decimal places. $($Enter any factor amounts to three decimal$$ places, X$.$XXX$.$ Use parentheses or a minus sign for a negative net present$$ value.$)$

Caclulate the NPV$($net present$$ value$)$ of each project. Begin by calculating the NPV of Project A$.$

Project A:

Net Cash

Annuity PV Factor

Present

Years

Inflow

$($i$=16\%,$ n$=7)$

Value

$1-7$

Present value of annuity

$0$

Investment

Net present value of Project A