Perkins Corporation is considering several investment proposals, as shown below:

Joetz Corporation has gathered the following data on a proposed investment project (Ignore income taxes.):

Investment required in equipment	$	33,000
Annual cash inflows	$	7,200
Salvage value of equipment	$	0
Life of the investment		15	years
Required rate of return		10	%

The company uses straight-line depreciation on all equipment. Assume cash flows occur uniformly throughout a year except for the initial investment.

Click here to view Exhibit 12B-1 and Exhibit 12B-2, to determine the appropriate discount factor(s) using the tables provided.

The internal rate of return of the investment is closest to:

Multiple Choice

• 22%

• 20%

• 18%

If the project profitability index is used, the ranking of the projects from most to least profitable would be:

Multiple Choice

• D, B, C, A

• B, D, C, A

• B, D, A, C

• A, C, B, D