Consider the following two mutually exclusive projects:

YearCash Flow

(A)Cash Flow

(B)0-$343,000-$50,000152,00024,700272,00022,700372,00020,2004447,00015,300

Whichever project you choose, if any, you require a 16 percent return on your investment.

a-1What 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 periodProject AyearsProject Byears

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

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

Discounted payback periodProject AyearsProject Byears

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

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

NPVProject A$Project B$

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

d-1What 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.)

IRRProject A%Project B%

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

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

Profitability indexProject AProject B

e-2If you apply the profitability index criterion, which investment will you choose?Project AProject Bf.Based on your answers in (a) through (e), which project will you finally choose?(Click to select)

Project A

Project B