The management of ABC Ltd anticipates purchasing one of the pump models below. Each model has an initial cost outlay of Ksh 15,000 and a useful life of 5 years.

The corporation tax rate is 30% and the required rate of return is 10%. The pumps are depreciated using straight line method. The before tax and depreciation cash flows expected to be generated by the projects are as follows:

Year	1	2	3	4	5
Model I	8,000	8,000	6,000	5,000	4,000
Model II	6,000	6,000	6,000	6,000	6,000

Required:

1. Compute the AAR, PBP, NPV, PI and IRR for each project