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4. Shown below are details for two proposals. Evaluate this proposal using payback, discounted payback, net present value profitability index, and internal rate of return.

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4. Shown below are details for two proposals. Evaluate this proposal using payback, discounted payback, net present value profitability index, and internal rate of return. Show your work. Make a recommendation on which proposal to accept (if either), and explain your decision. Project Data Time horizon Installation costs Cost savings each year Incremental revenue each year Project A 5 years $100,000 $15,000/year $65,000/year Project B 5 years $200,000 $18,000/year $62,000/year Lease payments per year Estimated economic life Straight line depreciation with salvage of... Cost of capital Tax Rate $25,000 5 years 0 1496 Not applicable $35,000 5 years $30,000 1496 Not applicable

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