Ranking Investment Proposals: Payback Period, Accounting Rate of Return, and Net Present Value Presented is information pertaining to the cash flows of three mutually exclusive investment proposals: Proposal A Proposal B Proposal C Initial Investment $45,000 $45,000 $45,000 Cash flow from operations Year 1 $40,000 $22,500 $45,000 Year 2 5,000 $22,500 Year 3 22,500 22,500 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 difference in rankings. Which investment would you recommend