An arts foundation is considering two proposals that have been submitted by its members: Proposal 1: Buy a library of animated film classics for $15 million. The collection has to be restored, at no additional cost, which will take 3 years. In 4 years, film cash flows are expected to be $6 million a year for five straight years.
Proposal 2: Buy modern oil paintings for $1 million and then lease them to museums for $100,000 per year starting in year 1 and continuing for 4 years. In year 5, the paintings would be sold for $2 million.
Compute the NPV and the IRR for each project. Use a required return of 9%. Which proposal is better? Explain your reasoning.

Astudent was asked to draw a demand and supply graph to illustrate the effect on the market for premium bottled water of a fall in the price of electrolyteselectrolytes used in some brands of premium bottled​ water, holding everything else constant. she drew the graph to the right and explained it as​ follows: ​"electrolyteselectrolytes are an input to some brands of premium bottled​ water, so a fall in the price of electrolyteselectrolytes will cause the supply curve for premium bottled water to shift to the right​ (from upper s 1s1 to upper s 2 right parenthesis .s2). because this shift in the supply curve results in a lower price left parenthesis upper p 2 right parenthesis commap2, consumers will want to buy more premium bottled water and the demand curve will shift to the right​ (from upper d 1d1 to upper d 2 right parenthesis .d2). we know that more premium bottled water will be​ sold, but we​ can't be sure whether the price of premium bottled water will rise or fall. that depends on whether the supply curve or the demand curve has shifted farther to the right. i assume that the effect on supply is greater than the effect on​ demand, so i show the final equilibrium price left parenthesis upper p 3 right parenthesisp3 as being lower than the initial equilibrium price left parenthesis upper p 1 right parenthesis .p1.​" where is the flaw in the​ student's argument? supply will shift inward. demand will not shift. demand will shift inward.