5. A hospital is considering the possibility of two new purchases: new X-ray equipment and new biopsy equipment. Each project would require an investment of $750,000. The expected life for each is 5 years with no expected salvage value. The net cash inflows associated with the two independent projects are as follows: Page 2 of 3 Year X-ray equipment Biopsy equipment 1 $375,000 $75,000 2 2 150,000 75,000 3 300,000 525,000 4 150,000 600,000 5 75,000 675,000 Required (30 marks): a. Compute the payback period for each project. (20 marks) b. Assume that the manager of the hospital accepts only projects with a payback of 3 years or less. Offer some reasons why this may be a rational strategy, even though the calculated net present values X-ray equipment and Biopsy equipment are $55,821 and $514,766 respectively, (10 marks)