Proposal A	Proposal B	Proposal C
Initial Investment	$67,500	$67,500	$67,500
Cash Flow from operations
Year 1	60,000	33,750	67,500
Year 2	7,500	33,750	0
Year 3	33,750	33,750	0
Disinvestment	0	0	0
Life (years)	3 years	3 years	1 year

Required:

a. Rank these investment proposals using the payback period, the accounting rate of return on initial investment, and the net present value criteria. Assume that the organizations cost of capital is 12 percent. Round calculations to four decimal places.

b. Explain the differences in rankings. Which proposal would you recommend and why?