Flacol Chemicals is considering Projects S and L, whose cash flows are shown below.These projects are mutually exclusive, equally risky, and not repeatable.The CEO believes the IRR is the best selection criterion whereIRRL =10.71181%,IRRS = 12.24157%, while the CFO advocates the NPV.If the decision is made by choosing the project with the higher IRR rather than the one with the higher NPV, how much, if any, value will be forgone, i.e., what's the chosen NPV versus the maximum possible NPV?Note that (1) "true value" is measured by NPV, and (2) under some conditions the choice of IRR vs. NPV might have no effect on the value gained or lost.(5 marks) WACC:7.50% Year0 1 2 3 4CFS -$1,100 $550 $600 $100 $100 CFL -$2,700 $650 $725 $800 $1,400

ii) In addition, calculate and explain the decision criterion of the payback periods where management set benchmark is 3years.(5 marks)

iii) Now let's assume the projects are independent. Based on the result of PBP and NPV, which project(s) should Flacol Chemicals choose?(2 marks)