Q1 A company can purchase a fixed asset for SR 100,000 initial investment. The investment will generate a tax-free cash flow of SR 25,000 per annum for 5 years. a. Calculate the Net present value if the cost of capital is 12% b. What should be maximum required rate of return that the firm can have and still accept the project Q2 UPM has three projects under consideration. Project A Project B Project C Initial investment 150,000 150,000 150,000 Year 1 30,000 15,000 25,000 2 30,000 35,000 20,000 3 30,000 20,000 15,000 4 30,000 40,000 40,000 5 30,000 5,000 35,000 6 30,000 9,000 5,000 If the cost of capital is 16% a. Calculate projects payback period, which project will be preferred? b. Calculate the NPV and rank the projects c. Calculate the IRR and rank the projects d. Which project you will take based on NPV and IRR