QUESTION 6 - CAPITAL BUDGETING TECHNIQUES All Natural Juices Company Limited is considering two (2) mutually exclusive investments. As the Finance manager you have advised that the company use a CAPM-Type Risk-Adjusted Discount Rate (RADR) for its analysis. Your research indicates that the firm's cost of capital, r, is 8%, and the estimated risk-free rate, Rf is 2%. Project A has a RADR factor (Risk Index) of 1.6, and Project B has a RADR factor (risk index) of 0.5. Cash flows associated with the two (2) projects are shown in the table below Project A Project B $200,000 $220,000 YEAR NET CASH INFLOWS (NCF) 1 $100,000 $64,000 2 $100,000 3 $100,000 4 van een beperneurs.de Answer the following questions: a. Calculate the Risk-Adjusted Rate (RADR) for Projects A and B respectively. (4 marks) b. Use a Risk-Adjusted Discount Rate (RADR) approach to calculate the Net Present Value (NPV) of each project (7 marks). C. Identify the preferred project in part b (1 mark) d. Using the NPVs calculated in part b, and an 8% cost of capital, estimate the Annualised Net Present Value (ANPV) the two projects (4 marks) e. Identify the preferred project in part d (1 mark) f. Using your findings in parts b to e, identify the project to be undertaken. Please provide reasons to justify your