Projects 1 and 2, of equal risk, are alternatives for expanding X Company's capacity. The firm's cost of capital is 11%. The cash flows for each project are shown in the following table:

	Project 1	Project 2
Initial investment	$100,000	$60,000
Year	Cash inflows
1	$20,000	$20,000
2	$25,000	$20,000
3	$30,000	$20,000
4	$35,000	$20,000
5	$40,000	$20,000

Your Answer: (Round to two decimal places.)

a. The payback period of Project 1 is Blank 1. Fill in the blank, read surrounding text. years. The payback period of Project 2 is Blank 2. Fill in the blank, read surrounding text. years. b. The NPV of Project 1 is $ Blank 3. Fill in the blank, read surrounding text. . The NPV of Project 2 is $ Blank 4. Fill in the blank, read surrounding text. . c. The IRR of Project 1 is Blank 5. Fill in the blank, read surrounding text. %. The IRR of Project 2 is Blank 6. Fill in the blank, read surrounding text. %. d. Which project will you recommend? Project Blank 7. Fill in the blank, read surrounding text.