XYZ Corporation is faced with two mutually exclusive investment opportunities. The cost of capital is 12 percent. The cash flows for the two projects are:
Project A Project B
Year Cash Flow Cash Flow
0 -$140,000 -$100,000
1 60,000 30,000
2 60,000 30,000
3 60,000 30,000
4 30,000
5 30,000
6 30,000
What is the NPV for each investments UNDER THE REPLACEMENT APPROACH?