Proposal #1 from Sunny Days, Inc. Initial investment is $100M with cost savings each of the following 3 years of $60M. Proposal #2 from Reflective Farms Inc. Initial investment is only $20M but the cost savings each of the flowing 3 years is only $25M Proposal #3 from Power Link Inc. Initial investment is $100M with savings as follows: Year 1- $90M, Yr 2- $70M and Yr 3- $5M calculate the Net Present Value, the Internal Rate of Return, the Profitability Index and a Payback for each proposal in order to make the best recommendation. cost of capital at 12% (that is our discount rate). SHOW YOUR WORK!!

Let me know which Proposal you would recommend and why? Please rank them in the order of your preference and explain why you chose the winning bid proposal you did?