2. Each of two mutually exclusive projects involves an investment of $124,000. Net cash flows for the projects are as follows:

Year Project A Project B

1 $60,000 $55,000

2 68,000 64,000

3 36,000 42,000

A. Calculate each project's payback period.

B. Compute the Net Present Value (NPV) of each project when the firm's cost of capital is 8 percent.

C. Internal Rate of Return (IRR) -Your choice; based on your answer to part (B).

D. Modified Internal Rate of Return (MIRR) Your choice; based on your answer to part (B).