Consider the following two mutually exclusive projects:

YearCash Flow(A)Cash Flow(B)0-52000-50000145000250002500004000036500019500Whichever project you choose, if any, you require a 12 percent return on your investment.

Use payback period criterion and make a choice.

• Payback period for project A; Payback period for project B
• Using discounted payback period criterion, make a choice.Discounted payback period for project A;Discounted payback period for project B
• What is the choice when you use NPV?NPV for project A, NPV for project B
• How about IRR?IRR for project A, IRR for project B
• PI?PI for project A, PI for project B
• Final decisionOverallwhich project will you choose