Part 2: Investment Choices A firm has the option of investing in the following two projects:

Postes	Projet A	Projet B
Single Investment Flow	420 000,00	440 000,00
Lifetime	5,00	5,00
Turnover
Year 1	640 000,00	1 200 000,00
Growth rate year 2 to 5	7%	4%
Variable costs	60%	65%
Fixed costs excluding depreciation	200 000,00	350 000,00
Corporate income tax	1/3	1/3
WCR in days of sales (based on 360 days	15,00	35,00
Disposal value or residual value expressed as cash flow equivalent of the year 5	2,00	2,00

The risk-free money market rate is 4.5%. The expected market return is 11% and the current beta of the company's assets is 0.8 1- Determine the cash flows of each project 2- The cost of capital is 9.7%. Calculate the Van of the projects and make a recommendation