Case 8: Capital Budgeting Univac is currently evaluating three projects. The company's cost of capital is 15% and the risk free rate is at 10%. The Finance department currently forecasted the following cashtlow of each project together with the risk index as shown below Projects " Initial Cashoutflows $ 15,000.00 $ 11,000.00 $ 19,000.00 Year Cash Inow sCosh Outflows Cash Inflows Cash Outflows Cosh Inflows Cash Outflows . . 3 4.00000 3 10,000.00 3. 4,000.00 3 6000.00 s 200000 2| . . 4.00000 2.000.00I 3.00000 0000.00 2000.00 3 . . 4.00000 9.00000 4.00000 12000.00 4.00000 Risk Index __-_ l . How long is the payback period of each project? 2. Using the company's cost of capital what is the Net Present Value of each project? 3. Using RADR what would be the Risk-Adjusted NPV of each project? 4. Using the Risk-Adjusted NPV. which projectfs would you recommend assuming that the three projects are independent projects and the company currently have $35,000 budget