Conrad Mining Inc. uses a cost of capital of 11 percent to evaluate average risk

Question

Conrad Mining Inc. uses a cost of capital of 11 percent to evaluate average risk project and it adds or subtracts 3 percent to adjust for risk. Currently the firm has two mutually exclusive projects under consideration. Both the projects have an initial cost of $100,000 and will last four years.

Calculate the NPV value of Project A and B. (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))

Conrad Mining Inc. uses a cost of capital of 11 percent to evaluate average risk project and it adds or subtracts 3 percent to adjust for risk. Currently the firm has two mutually exclusive projects under consideration. Both the projects have an initial cost of $100,000 and will last four years.

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