EXHIBIT $1.$

Harding Plastic Molding Company

Cash Flows:

Year Project A Project B

$0$ $$-75,000$ $$-75,000$

$110,00043,000$

$230,00043,000$

$3100,00043,000$

EXHIBIT $2.$

Harding Plastic Molding Company

Cash Flows:

Year Project C Project D

$0$ $$-8,000$ $$-20,000$

$111,00025,000$

QUESTIONS

$1)$ What are the NPV$,$ PI$,$ Payback, and IRR for projects A and B$?$ Should project A or B be chosen? Might your answer change if project B is a typical project in the plastic molding industry?

$2)$ What are the NPV$,$ PI$,$ Payback, and IRR for projects C and D$?$ Should project C or D be chosen?