Answers should be in Word or Excel File

Section 11 (Marks: 20 X 5M = 10Marks) Attempt All 1. SONY Corporation is considering signing a one year contract with one of two computer- based marketing firms. Although one is more extensive, it offers a more extensive program and thus will provide higher after tax net cash flows. Assume these two options are mutually exclusive and that the required rate of return is 12%. Given the following after tax net cash flows Year Option-A - 10000 AED 20,000 AED Option-B 40000 AED 70000 AED a) Calculate the net present value b) Calculate the profitability index c) If there is no capital rationing constraint, which project should be selected