14. Consider the following projects: Cash Flows (3) Projects Co C C Ca A -1,000 +000 +200...

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14. Consider the following projects: Cash Flows (3) Projects Co C C Ca A -1,000 +000 +200 +200 +1,000 B -1,000 +200 +200 +600 +1,000 C -1,300 +100 +100 +100 +1,600 D -1,300 0 0 +300 +1,600

(a) Calculate the payback period for each project.

(b) If the standard payback period is 2 years, which project will you select? Will your answer be different if the standard payback is 3 years?

(c) If the cost of capital is 10 per cent, compute the discounted payback for each project? Which projects will you recommend if the standard payback is () 2 years; (i) 3 years?

(d) Compute the NPV of each project? Which projects will you recommend?

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