$(20)$

Assume that your company wants to choose between two project options: Project A: $R500,000$ invested today will yield an expected income stream of R$150,000$ per year for five years, starting in year $1.$ Project B: an initial investment of R$400,000$ is expected to produce this revenue stream: Year $1=0,$ Year $2=R50,000,$ Year $3=R200,000,$ Year $4=R300,000$ and Year $5=R200,000$

$4.1$ Assume a required rate of return of your company is $10\%$ and the inflation is expected to remain steady at $3\%$ for the life of the project. Which is the better investment? Why?

$4\mathrm{.}2$ Two new internet projects are proposed to EDU$-$CUT. Project A will cost R$250,000$ to implement and is expected to have annual net cash flows of $R75,000.$ Project $B$ will cost $R150,000$ to implement and should generate annual net cash flows of $R52,000.$ EDU$-$CUT is very concerned about their cash flow. Using the payback period, which project is better from a cash flow perspective?

$(5)$