Grinders he, operates a chain of doughnut shops. The company is considering two possible expartsion plans. Plan.A would open eight smalloe shops at a cost of s8. 940 , 000. Erpectod annual net cash inflows are $1,600,000 whith zero residual value at the end of ten years. Under Plan B, Grinders would open three larger shops at a cont of $8,240,000. This plan is 6xpected to generate net. cash infiows of $1,000,000 per year for ten years, the estimated He of the properties. Estimated residual value is $1,000,000. Grinders uses straight-line depreciation and requires an annuis return of 8\%. (Cick the icon to view the present value annuty factor table.) (Ciek the licon to viow the present value factor table) (Click the icon to vew the future value annuty facior table.) (Cick the icon to view the futuro value factor table) Read the requinetents Requirement 1. Compute the pyytack period the ARR, and the NPV of these two plans. What are the strengths and weaknesses of these capital budgeting models? Begin by computing the payback period lor both plans. (Round your answers to one decimal plece) Pian A (in years) Pian B (in years) Now computo the ARR (ascounsing rate of return) for both plans, (Round the percentages to the nearest tenth percent) Plan A Plan B Nexd compute the NpY (cet present value) under each plan. Begin with Plan A, then compute Plan B. (Round your answers to the nearest whole dollar and use parentheses or a minus sign to reprasert a negative NPV.) Not peesent vatue of Plan A Requirements 1. Compute the payback period, the ARR, and the NPV of these two plans. What are the strengths and weaknesses of these capital budgeting models? 2. Which expansion plan should Grinders choose? Why? 3. Estimate Plan A's IRR. How does the IRR compare with the company's required rate of return