a. Calculate each projects payback period, net present value (NPV), internal rate of return (IRR), and modified internal rate of return (MIRR) when the WACC is 12%. Which has the highest NPV? IRR?

b. Which project or projects should be accepted if they are independent (WACC = 12%)?

c. Which project should be accepted if they are mutually exclusive (WACC = 12%)? Explain how this depends on the decision criteria used (e.g., if there is a conflict in what is best between decision rules, explain why and which to use).

2. A fishery is considering two projects. You are to evaluate them. The projects' expected net cash flows are as shown below. Parentheses indicate a negative cash flow. Time difference 0 175 1 570 N 320 Expected net cash flows Project A Project B ($325) ($500) ($400) $170 ($150) $170 ($100) $170 $600 $170 $600 $170 $926 $170 ($200) 0 3 270 4 430 5 430 6 756 7 200 NPV PB Period IRR MIRR