Following is information on two alternative investments being considered by Jolee Company. The company requires a 8% return from its investments. (PV of $1,FV of $1,PVA of $1, andFVA of $1)(Use appropriate factor(s) from the tables provided.)

Initial investment A$(187,325)B$(150,960)

Expected net cash flows in:

Year 1 54,000 43,000

Year 2 48,000 55,000

Year 3 80,295 52,000

Year 4 84,400 74,000

Year 5 71,000 30,000

a.For each alternative project compute the net present value.

b.For each alternative project compute the profitability index. If the company can only select one project, which should it choose