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Question 2 Kengsington Industries has received following the following business proposals. It has done some financial research and the team has come up with the

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Question 2 Kengsington Industries has received following the following business proposals. It has done some financial research and the team has come up with the following cash flow projections. You are required to advise the company on the decision to make. Project Gamma Project Tita Initial Investment in 2020 2,000,000 2,000,000 Cash Flow returns Year 2021 Year 2022 Year 2023 Year 2024 Year 2025 400,000 600,000 1,000,000 1,200,000 1,000,000 1,000,000 1.000.000 600,000 300,000 200,000 Using the information given above : Compute the payback period of both projects Recommend project to be choosen for investment using paybackr List down one advantage and one disadvantage of payback methox Using a 10% cost of capital interest rate) compute NPV of both p Recommend your decision based on NPV method List down one advantage and one disadvantage of NPV method What 5 other qualitative factors you will consider other than the al calculations in making a final decision? (6 marks) (1 marks) (2 marks) (8 marks) (1 marks) (2 marks) (10 marks)

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