CASHFLOW
PROJECT	C0	C1	C2	C3	C4	C5
A	-5,000	5,000	0	0	0	0
B	-3,000	1,000	1,000	3,000	1,500	1,500
C	-2,000	1,000	500	0	1,200	1,200

1. If the opportunity cost of capital is 10%, compute the projects NPV. Which project(s) should the firm accept?

2. Calculate the payback period for each project. Which project(s) would a firm using the payback rule accept if the cut-off period were three years?

3. Calculate the internal rate of return (IRR) of project A.

4. If we only have 7,000 to invest in, which project(s) should we select and why?