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Lou Bariow, a divisionai manager for Sage Company, has an opportunity to manufacture and sell one of two new products for a five. year period.

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Lou Bariow, a divisionai manager for Sage Company, has an opportunity to manufacture and sell one of two new products for a five. year period. His annual pay raises are determined by his division's retum on investment (ROI). which has exceeded 23% each of the last three years. He has computed the cost and revenue estimates for each proctuct as follows: Click here to view Exhibit 148-1 and Exhibit 148-2, to determine the appropriate discount factor using tables. Required: 1. Calculate the payback period for each product 2. Calculate the net present value for each product 3. Calculate the internal rate of retum for each product. 4. Calculate the profitability index for each product 5. Calculate the simple rate of retum for each product. 6a. For each measure, identify whether Product A or Product 8 is preferred' 6b. Based on the simple rate of retum, which of the two products should Lou's division accent? Complete tils question by entering your answers in the tabs below. Calciate the payback period for each product. (Rouind your ans ivern to z decimal places.)

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