Waterloo North Hydro has two options for upgrading a hydro-electric power station to meet new government standards. Option 1: Waterloo North Hydro will make the upgrades themselves. This is expected to cost $11,800 at the end of every three months for 13 years. At the end of the operation (in 13 years) Waterloo North Hydro expects to sell all equipment needed for the upgrade for $108,000. Option 2: Pay experienced contractors. This will cost $25,000 up front and $14,100 quarterly for 11 years. Assume all interest is 2.02% compounded quarterly. Round the answers to NPV (Option 1), and NPV (Option 2) to the nearest dollar. Round all other answers to two decimal places where applicable. 1) Find the net present value of option 1: Payments (Cost) Sale of equipment (Residual) P/Y = 4 OM C/Y = N = 52 52 IXY = 2.02 0 % 2.02 0 % PV = $ 538458.90 OM $ 83112.25 PMT = $ 11800 $ 0 FV = $ 699,699.06 x $ 108,000.000 FV = $ 699,699.06 x $ 108,000.00 (If the NPV is negative, enter it as a negative number. If the NPV is zero, enter o.) NPV (Option 1) = $ -455347.000 2) Find the net present value of option 2: Payments (Cost) P/Y O 4 C/Y 4 N 44 I/Y 2.02 0 % PV $ 530,056.74 X PMT $ 14100 FV $ 661,576.01 X (If the NPV is negative, enter it as a negative number. If the NPV is zero, enter 0.) NPV (Option 2) = $ -530,057