Equivalent annual annuity in unequal projects


Problem: Two Projects with unequal length and cost of capital 10%. Which is the best project and please show the steps how to solve for equivalent annual annuity in unequal projects.

Yr. 0 Project 1: ($150,000) Project 2: ($200,000)
1 $80,000 $40,000
2 $60,000 $50,000
3 $50,000 $50,000
4 $60,000
5 $50,000
6 $53,000

Please show steps to solve.

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Finance Basics: Equivalent annual annuity in unequal projects
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