# Calculate the NPV for each project using each scenario’s NPV rate.

Words: 123
Pages: 1
Subject: Finance

Year Project#1 Project#2 Project#3
0 (\$30.000) (\$32,000) (\$35,000)
1 \$11,000 \$15,000 \$11,000
2 \$11,000 \$14,000 \$11,000
3 \$11,000 \$11,000 \$11,000
4 \$11,000 \$2,000 \$11,000
5 \$11,000 \$500 \$11,000

Scenario NPV Rate
1 5%
2 5.5%
3 6%

Using the data in the tables above, answer the following questions:
• Calculate the NPV for each project using each scenario’s NPV rate. Show your work.

• Calculate the pay-back period for each project. Show your work.

• Calculate the IRR for each project. Show your work.

• Which project would the company select using the NPV method in scenario 1? Explain your answer.

• Which project would the company select using the NPV method in scenario 2? Explain your answer.

• Which project would the company select using the NPV method in scenario 3? Explain your answer.

• Which project would the company select using the pay-back period? Explain your answer.

• Which project would the company select using the IRR method? Explain your answer.