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A&B Enterprises is trying to select the best investment from among four alternatives. Each alternative involves an initial outlay of $100,000. Their cash flows follow:

A&B Enterprises is trying to select the best investment from among four alternatives. Each alternative involves an initial outlay of $100,000. Their cash flows follow:

Year A B C D
1 $10,000 $50,000 $25,000 $0
2 20,000 40,000 25,000 0
3 30,000 30,000 25,000 45,000
4 40,000 0 25,000 55,000
5 50,000 0 5,000 60,000

Evaluate and rank each alternative based on a) payback period, b) net present value (use a 10% discount rate), and c) internal rate of return.

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