My Bean inc. operates a chain of lunch shops. The company is considering two possible expansion plans. Plan A would open eight smaller shops at a cost of 58,940,000. Expected arnual net cash intows are $1,550,000 with zero residual value at the end of ten yeare. Under Plan B, My Bean would open three larger shops at a cost of $8,840,000. This plan is expectod to generate net cash inflows of $1,050,000 per year for ten yeans, the estimated life of the properties. Estimated nesidual value is $1,005,000. My Bean ises straight. ine depreciabon and tequires an annual retum of 10% (Cick the icon to view the present value annuity tactor lable) (Cick the icon to view the fayre value annily factor table.) (Cick the ionn to wew the present value factor tablo) Pesd the tequitrmets (Click the icon to vew the futare vilue factor table.) Requirement 1. Compute the puyback period, the APR, and he NPV of these two plars. What at the strengtar and weaknesses of Ewese captal budgeting models? Begin by computing the payback penod for both plans (Reund your anseors to one decimal place) PanA (in years) Plan 8 (in years) Requirement 1. Compo Ruirements \begin{tabular}{l|l|} Begin by computing the & 1. Compute the payback period, the ARR, and the NPV of these two plans. What \\ are the strengths and weaknesses of these capital budgeting models? \\ Plan A (in years) & 2. Which expansion plan should My Bean choose? Why? \\ Plan B (in years) & 3.EstimatePlanAsIRR.HowdoestheIRRcomparewiththecompanysrequiredrateofreturn? \\ \hline \end{tabular}