a1. Net Present Value = Present value of annual saving - initial investment
NPV of Project A = 41086*Cumulative PVF @6%, 3 years - 104000
= $41086*2.673 - 104000 = $5822.88
NPV of Project B = 18095*Cumulative PVF @6%, 3 years - 45000
= $18095*2.673 - 45000 = $3367.94
a2. Project A.
b1.. IRR = Initial Investment / Annual cash inflow = Found the value in the Cumulative present value factor in the relevant year
Project A = 104000 / 41086 = 2.531 = 9%
Project B = 45000 / 18095 = 2.487 = 10%
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