1. Home Done is considering the replacement of one of its machine tools. Three alternative replacement tools A, B, and C are under consideration. The cash flows associated with each are shown in the following table. The firms cost of capital is 15 percent.
   1. Calculate the NPV of each alternative tool, and evaluate the acceptability of each tool. Rank the tools from best to worst, using NPV.
   2. Calculate the IRR of each alternative tool, and evaluate the acceptability of each tool. Rank the tools from best to worst, using IRR.
   3. Calculate the PI of each alternative tool, and evaluate the acceptability of each tool. Rank the tools from best to worst, using PI.
   4. Calculate the PP of each alternative tool, and evaluate the acceptability of each tool. Rank the tools from best to worst, using PP

	A	B	C
Initial Outlay	95,000	50,000	150,000
Years	Cash Inflow
1	20,000	10,000	23,000
2	20,000	12,000	23,000
3	20,000	13,000	23,000
4	20,000	15,000	23,000
5	20,000	17,000	23,000
6	20,000	21,000	35,000
7	20,000		46,000
8	20,000		58,000