c)

As a manager you need to select one of the following projects using various numerical models such as Payback Period, Average Rate of Return, Net Present Value and Profitability Index.

Particulars

Project-X

Project-Z

Initial investment

35000

55000

Year-1

15000

20000

Year-2

10000

15000

Year-3

(5000)

25000

Year-4

30000

10000

Year-5

15000

5000

Addition Information: Interest rate 8%, Inflation rate 2%