Excess Present Value Index and Average Rate of Return Swanson Corporation is evaluating five different capital expenditure proposals. The company's hurdle rate for net present value analysis is 12%. A 15% salvage value is expected from each of the investments. Information on the five proposals is as follows:

a. Compute the excess present value index for each of the five proposals. Round answers to three decimal places.

b. Compute the average rate of return for each of the five proposals. Round answers to one decimal place. For example, 0.4567 equals 45.7%

Proposal Required Investment Net Present Value Avg. Annual Net Income from Investment \begin{tabular}{|l|r|r|r} \hline A & $58,000 & $8,996 & $9,100 \\ \hline B & 88,000 & 5,812 & 12,000 \\ \hline C & 118,000 & 27,034 & 18,300 \\ \hline D & 158,000 & 7,544 & 21,500 \\ \hline E & 80,000 & 15,822 & 13,960 \end{tabular} Proposal Excess PV Index A B C D E Proposal Avg. Rate of Return \begin{tabular}{lll} \hline A & % \\ \hline B & % \\ \hline C & % \\ \hline D & % \\ E & % \end{tabular} c. Assume that Swanson will commit no more than $200,000 to new capital expenditure proposals. Using the excess present value index, which proposals would be accepted. Select the best answer. ite of return, which proposals would be accepted? Select the best answer. Now using the average rate of return, which proposals would be accepted? Select the best answer. Proposals A and B Proposals A and E Proposals B and D Proposals C and E Proposals A and D Next 8