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0 1 3 4 6 Rainbow Company is considering two mutually exclusive projects, one with a 4-year life and the other 6-year life. The after-tax
0 1 3 4 6 Rainbow Company is considering two mutually exclusive projects, one with a 4-year life and the other 6-year life. The after-tax cash flows from the two projects are as follows: Year Project AZ (RM) Project ZZ (RM) (400,000) (400,000) 162,000 120,000 2 162,000 120,000 162,000 120,000 162.000 120,000 5 120,000 120,000 Assuming a 15 percent required rate of return on both projects. You are required to calculate and determine the following: 1) Determine the Payback Period for each project. (3 marks) ii) Calculate the NPV of each project and assess its acceptability. (3 marks) Calculate the IRR for each project. (3 marks) iv) Calculate the Profitability Index for each project. (3 marks) v) Calculate the crossover rate of these projects
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