Neil Corporation has three projects under consideration. The cash flows for each of them are shown in the following table. The firm has a cost of capital of 12%.

a.Calculate each project's payback period.

b.Calculate each project's net present value (NPV).

c.Comment on your findings in parts a and b,and recommend the best project. Explain your recommendation.

Initial investment $50,000 $50,000 $50,000 Year 1 $19,000 $1,000 $37,000 2 $19,000 $10,000 $28,000 3 $19,000 $19,000 $19,000 4 $19,000 $28,000 $10,000 5 $19,000 $37,000 $1,000