A company is evaluating the following investment opportunities with the given cash flows:

• Project A:

• Initial Investment: £20,000
• Year 1: £7,000
• Year 2: £6,000
• Year 3: £5,000
• Year 4: £4,000

• Project B:

• Initial Investment: £15,000
• Year 1: £5,000
• Year 2: £5,000
• Year 3: £5,000
• Year 4: £5,000

Requirements:

1. Calculate the Net Present Value (NPV) for each project at a discount rate of 9%.
2. Determine the Internal Rate of Return (IRR).
3. Compute the Payback Period for both projects.
4. Calculate the Profitability Index (PI).
5. Provide a recommendation on which project should be pursued.