Jamie Dermott graduated from Midland Stale University in June and has been working for about a month as a junior financial analyst at Caledonia Products. When Jamie arrived at work on Friday morning he found the following memo in his e-mail: TO. Jarrne Dermott FROM V. Morrison. CFO, Caledonia Products RE Capital-Budgeting Analysis Provide an evaluation at two proposed projects whose cash flow forecasts are found below: Since these projects involve additions to Caledonia's highly successful Avalon product line, the company requires a rate of return on both projects equal to 12 percent As you are no doubt aware. Caledonia relies on a number of criteria when evaluating new investment opportunities, in particular, we require that projects that are accepted have a payback of no more than three years, provide a positive NPPV, and have an IRR that exceeds the firm's discount rate. Jamie was not surprised by the memo, for he had been, expecting something like this for some time. Caledonia followed a practice of testing each of their new financial analysis with some type of testing evaluation exercise after they had been on the job for a few months. After re-reading the memo, Jamie decided on his plan of attack. Specifically, he would first do the obligatory calculations of payback, NPV, and IRR for both projects. Jamie knew that the CFO would grill him thoroughly on Monday morning about his analysis, so he wanted to prepare well for the experience. One of the things that occurred to Jamie was that the memo did not indicate whether the two projects were independent he had better rank the two projects in case he was asked to do so on Monday morning. Jamie sat down and made up the following "to do" list: Compute payback, NPV, and IRR for both projects. Evaluate the two project's acceptability using all three decision criteria(listed above) and based on the assumption that the projects are independent. That is, both could be accepted if both are acceptable. Rank the two projects and make a recommendation as to which(if either) should be accepted under the assumption that the projects are mutually exclusive. assignment-Prepare Jamie's assignment for his Monday meeting with the CFO by filling out your response to the "to do" list above