Kilkennie plc., manufactures components for the automobile industry. The company has recently been approached to supply components to eight projects. The finance manager, Fredrick Wright, is concemed that the existing funds available to the company are insufficient to execute all the projects. Based on Fredrick's recommendation, management have decided to allocate 660,000 to execute some of the projects. These projects are labeled A-H. The projects are not mutually exclusive. The table below provides you with the cost of each project, duration of each project and expected cash inflows at the end of each year. All the cashflows are in annuity. The estimated cost of capital is 10%. Project Cost (in ) Project duration Annual cash (in years) Inflow (in ) A 400,000 20 58,600 B 100,000 8 24,000 C 50,000 5 14,000 D 85,000 15 12,000 E 260,000 10 55,000 F 75,000 6 18,000 G 250,000 10 41,000 H 250,000 3 101,000 Kilkennie plc has sought your advice as to which of the above projects should it select to invest the 660,000. The projects are divisible. Required 1) Calculate the Net Present Value (NPV) for each project a) State the NPV decision rule b) Based on the NPV decision rule, select the projects that should be financed with the 660,000 budget c) Calculate the overall NPV for the selected projects in part b) (Total: 25 marks)