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Hannah, Inc. is planning a new capital investment. The company has a 7.8% required rate of return and a 6.3% cost of capital. Hannah currently

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Hannah, Inc. is planning a new capital investment. The company has a 7.8% required rate of return and a 6.3% cost of capital. Hannah currently has a return of 8% on its other investments. The proposed new investment has equal annual cash inflows expected. Management calculated the payback period using the computation of the investment and annual cash flows, and the IRR for 6 investments that are displayed below. Each investment has a 7-year expected useful life and no salvage value. IRR Payback Period 5.2 6.9 60 Project A2 Project B4 Project C6 Project D7 Project E9 Project F8 Project G3 Investment Cost $125,000 62.000 78,000 56,000 110,000 60,000 71,000 8.5% 3.1% 11.4% 5.4% 10.1% 7.9% 7.8% 5.8 4.2 5.0 7.3 a. Identify which project(s) is/are unacceptable and briefly state the conceptual justification as to why each of your choices is unacceptable. b. Hannah has $334,000 available to spend. List the project(s) in which Hannah should invest in the order the investments should be undertaken. c. Will Hannah be motivated to invest in all of the projects you selected in Part b if Hannah is evaluated using return on investment? d. How can these range of investment options be used to achieve "Strategic Cost Advantage

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