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Question 2 : Financial Model ( 5 marks ) Assume that you're a P r oject Manager at ABC Company, and you are recommending whether

Question 2: Financial Model (5 marks)
Assume that you're a Pr oject Manager at ABC Company, and you are recommending whether the company should invest in Project A or Project B. The details about the two projects are given below.
Project A: $400,000 invested today will yield an expected income stream of $100,000 per year for three years, starting in Year 1 and on fourth and fifth year it generates $150,000.
Project B: An initial investment of $500,000 is expected to produce this revenue stream: Year 1=$100,000, Year 2=$0, Year 3=$300,000, Year 4=$200,000, and Year 5=$300,000.
Give your recommendation based on discounted payback period and give reasons for your selection
if any?
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