Problem: Your division is considering two investment projects, each of which requires an up-front expenditure of $20 million. You estimate that the investment will produce the following net cash flows:
Year Project A Project B
1 $10,000,000 $20,000,000
2 $5,000,000 $5,000,000
3 $15,000,000 $5,000,000
Q1. What is the payback period for each project?
Q2. What are the two projects' net present values, assuming the cost of capital is 10 percent? Round to whole dollars.