Integrative ? Conflicting Rankings. The High-Flying Growth Company (HFGC) has been growing very rapidly in recent years, making its shareholders rich in the process. The average annual rate of return on the stock in the last few years has been 18%, and HFGC managers believe that 18% is a reasonable figure for the firm?s cost of capital. To sustain a high growth rate, the HFGC CEO argues that the company must continue to invest in projects that offer the highest rate of return possible. Two projects are currently under review. The first is an expansion of the firm?s production capacity, and the second project involves introducing one of the firm?s existing products into a new market. Cash flows from each project appear in the attached table.

Calculate the NPV for both projects. Rank the projects based on their NPVs.

Calculate the IRR for both projects. Rank the projects based on their IRRs.

Calculate the Pl for both projects. Rank the projects based on their Pls.

Display all calculations in an Excel Speadsheet.

All techniques, conflicting rankings. Nicholson Roofing Materials, Inc. is considering two mutually exclusive projects, each with an initial investment of $180,000. The company's board of directors has set a 4-year payback requirement and has set its cost of capital at 12%. The cash inflows associated with the two projects are shown in the attached table. a.Calculate the payback period for each project. Rank the projects by payback period. b.Calculate the NPV of each project. Rank the project by NPV. c.Calculate the IRR of each project. Rank the pro by IRR. d.Make a recommendation. e.According to the payback method, which project should the firm choose? f.According to the NPV method, which project should the firm choose? g.According to the IRR method, which project should the firm chooise? h.Which project will you recommend? i.Display all calculations in an Excel Spread sheet. Cash Inflows Year 1 2 3 4 5 6 Project A $60,000 $60,000 $60,000 $60,000 $60,000 $60,000 Project B $65,000 $70,000 $50,000 $50,000 $50,000 $50,000