Financial Evaluation of Projects (in $):

• Project A:

• Initial Cost: $18,000
• Year 1: $3,000
• Year 2: $4,000
• Year 3: $5,000
• Year 4: $6,000
• Year 5: $8,000

• Project B:

• Initial Cost: $15,000
• Year 1: $2,000
• Year 2: $3,500
• Year 3: $4,500
• Year 4: $5,000
• Year 5: $7,000

Required:

1. Calculate the payback period for both projects.
2. Determine which project to choose if the standard payback period is 4 years.
3. Compute the NPV at a discount rate of 9%.
4. Calculate the IRR for each project.
5. Assess the modified internal rate of return (MIRR) for both projects assuming a finance rate of 9% and a reinvestment rate of 10%.