Consider the following two mutually exclusive projects:

Year Cash Flow (A) Cash Flow (B)

0 $-358,000 $-46,000

1 37,000 23,200

2 57,000 21,200

3 57,000 18,700

4 432,000 13,800

a-1 What is the payback period for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) Payback period Project

a-2 If you apply the payback criterion, which investment will you choose?

b-1 What is the discounted payback period for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)

b-2 If you apply the discounted payback criterion, which investment will you choose?

c-1 What is the NPV for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)

c-2 If you apply the NPV criterion, which investment will you choose?

d-1 What is the IRR for each project? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

d-2 If you apply the IRR criterion, which investment will you choose?

e-1 What is the profitability index for each project? (Do not round intermediate calculations and round your answers to 3 decimal places, e.g., 32.161.)

e-2 If you apply the profitability index criterion, which investment will you choose?

f. Based on your answers in (a) through (e), which project will you finally choose?