1. The capital investment committee of Dowell Company is currently considering two investments. The estimated income of from operations and net cash flows expected from each investment are as follows:

	Truck				Equipment
Year		Income from operations	Net Cash Flow	Income From Operations		Net Cash Flow
		GH	GH	GH		GH
1		6,000	22,000	13,000		29,000
2		9,000	25,000	10,000		26,000
3		10,000	26,000	8,000		24,000
4		8,000	24,000	8,000		24,000
5		11,000	27,000	3,000		19,000
		44,000	124,000	42,000		122,000

Each investment requires GH80,000. Straight-line depreciation will be used, and no residual value is expected. The committee has selected a rate of 15% for the purpose of the net present value analysis.

Required

Compute the following

i. The average rate of return for each investment

ii. The net present value for each investment

iii. Prepare a summary for the capital investment committee, advising it on the relative merits of the two investments.