Blossom Corp. management is investigating two computer systems. The Alpha 8300 costs $3,006,625 and will generate...

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Blossom Corp. management is investigating two computer systems.The Alpha 8300 costs $3,006,625 and will generate cost savings of$1,548,725 in each of the next five years. The Beta 2100 systemcosts $4,627,500 and will produce cost savings of $1,177,750 in thefirst three years and then $2 million for the next two years. Thecompany’s discount rate for similar projects is 14 percent.
What is the NPV of each system? (Enter negative amounts usingnegative sign, e.g. -45.25. Do not round discount factors. Roundother intermediate calculations and final answer to 0 decimalplaces, e.g. 1,525.)
NPV of Alpha system ___
NPV of Beta system _
Which one should be chosen based on the NPV? Blossom shouldchose the _____ system.

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Solution NPV of Alpha system 2310273NPV of Beta system 329700The NPV of See Answer

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Blossom Corp. management is investigating two computer systems.The Alpha 8300 costs $3,006,625 and will generate cost savings of$1,548,725 in each of the next five years. The Beta 2100 systemcosts $4,627,500 and will produce cost savings of $1,177,750 in thefirst three years and then $2 million for the next two years. Thecompany’s discount rate for similar projects is 14 percent.What is the NPV of each system? (Enter negative amounts usingnegative sign, e.g. -45.25. Do not round discount factors. Roundother intermediate calculations and final answer to 0 decimalplaces, e.g. 1,525.)NPV of Alpha system _____NPV of Beta system _____Which one should be chosen based on the NPV? Blossom shouldchose the _______ system.