Case Study: Assume that your group is working in Finance Department of a construction company. Your company is considering the potential project as follow: Launching a new construction project. There are two options available for the company management's consideration. Option 1 is building an apartment in the city centre and option 2 is building a new residential community in a suburban area. It is estimated that within five years, the company can gradually build up and sell all the properties in two options. The company is currently facing soft capital rationing. The table below shows the estimated cash flow available to the company's Management: Option 1 12,235,000 Option 2 16,215,000 Initial Investment Annual cash inflow Year 1 Year 2 Year 3 Year 4 Year 5 4,390,000 4,320,000 5, 360,000 5,375,000 4,480,000 5,315,000 6,345,000 6,356,000 5,402,000 5,540,000 You are required to write a short report to the company's Management: 1) To select a relevant method among five investment criteria of Net Present Value (NPV), Equivalent Annual Cost (EAC), profitability Index (PI), Internal Rate of Return (IRR), Simple Payback Period, and Discounted Payback Period for this project, given the market required rate of return for all project is 12.5% and the company's benchmark of payback is maximum 3 years. Your recommendation must include your justification on why you choose the specific method based on its pros and cons compared to other methods and the financial circumstance of the company. (2 marks)