be Question 1 1 Jacky's company can employ a capital or labour intensive method of producing a particular product. An evaluation of the two possibilities produces the following net cash flows, net present values at the required rate of return of 15%, and internal rates of return. Time Capital intensive method Labour intensive method 0 ($90,000) ($20,000) 132,000 9,750 2 100,000 9,750 3 (150,000) 9,750 IRR 42.66% 21.71% Based on the information provide, the CEO of the company decided that the capital intensive method should be adopted since this method can produce a higher IRR. If you are the financial advisor of the company, what is/are your recommendation(s)? (5 marks) b. Compute the NPV of both methods. (12 marks) c. Which method should the company adopt if these two methods are mutually exclusive? (4 marks) d. If the company does not face a financial constraint and has no difficulty funding projects of this nature, which method should the company adopt? Please explain. (4 marks) a