A Company Is Considering Two Alternative Investment Opportunities, Each of Which

A company is considering two alternative investment opportunities, each of which requires an initial cash outlay of $110,000. The expected net cash flows from the two projects follow:
$$\begin{array} { | l | r | r | } \hline & \text { Project A } & \text { Project Z } \\\hline \text { Year 1 } & \$ 30,000 & \$ 44,000 \\\hline \text { Year 2 } & 44,000 & 70,000 \\\hline \text { Year 3 } & 70,000 & 30,000 \\\hline \text { Totals } & \$ 144,000 & \$ 144,000 \\\hline\end{array}$$ Required:
(1) Based on a comparison of their net present values, and assuming the same discount rate greater than zero is required for both projects, which project is the better investment?
(2) Use the table values below to find the net present value of the cash flows associated with Project A, discounted at 12%:
Periods Present value of 1 at 12%
1………………. 0.8929
2………………. 0.7972
3………………. 0.7118