Investment Opportunity	Annual profit Sh.	Cost of investment Sh.
A	300,000	900,000
B	300,000	1,600,000
C	240,000	1,200,000
D	280,000	800,000
E	260,000	1,000,000

Additional Information

1. The company currently has profits of Sh.1, 250,000 and investments of Sh.5, 000,000
2. The minimum required rate of return of the company is 20%
3. The Company will only invest in projects that will improve on the current performance

Required

1. The return on investment (ROI) and the residual Income (RI) for each of the investment opportunities
2. Based on the performance measures above, rank the investment opportunities in their order of preference. Comment on the project(s) that the company should invest in (Hint: select the project(s) that will maximize the final profitability)