1. Manager Cafe "Daiton" is considering investing in 2 (two) projects. Project X is an investment of $ 75,000 to replace its refrigeration equipment works but outdated / outdated. Project Y is an investment of $ 1,500,000 expand the dining room facilities. Cash flow data is relevant for both projects for 2 years are expected to be as follows:

a. Compute: Expected value, standard deviation, and coefficient of variation for cash flows of each project.

b. Calculate: Risk-adjusted NPV for each project using cost of capital 15% for riskier projects, and cost of capital 12% for less risky projects. Which project is more profitable with using the NPV criteria?

c. Calculate: PI for each project, and rank the projects according to the criteria

d. Calculate: IRR for each project, and rank the projects according to the IRR criteria.

e. Compare your answers to b, c, and d, and discuss any differences.

Project X Year 1 Year 2 Probability Cash Flow Probability Cash Flow 0.16 SO 0.08 $0 0.66 50000 0.82 50000 0.18 100000 0.10 100000 Project Y Year 1 Year 2 Probability Cash Flow Probability Cash Flow 0.50 SO 0.13 $O 0.50 200000 0.74 100000 0.13 200000 Project X Year 1 Year 2 Probability Cash Flow Probability Cash Flow 0.16 SO 0.08 $0 0.66 50000 0.82 50000 0.18 100000 0.10 100000 Project Y Year 1 Year 2 Probability Cash Flow Probability Cash Flow 0.50 SO 0.13 $O 0.50 200000 0.74 100000 0.13 200000