Perez Company has a choice of two investment alternatives. The present value of cash inflows and outflows for the first alternative is \$180,000 and \$154,000, respectively. The present value of cash inflows and outflows for the second alternative is \$355,000 and \$290,000, respectively.
Required
a. Calculate the net present value of each investment opportunity.
Note: Negative amounts should be indicated by a minus sign.
b. Calculate the present value index for each investment opportunity.
Note: Round \"PVI\" to 2 decimal places.
c. Indicate which investment will produce the higher rate of return.
a. Alternative 1 (NPV)
a. Alternative 2 (NPV)
b. Alternative 1 (PVI)
b. Alternative 2 (PVI)
c. The investment that will produce the higher rate of return is