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The Simpson Corporation is trying to choose between the following two mutually exclusive design projects: Year | WN- 0 1 2 3 Cash Flow (1)

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The Simpson Corporation is trying to choose between the following two mutually exclusive design projects: Year | WN- 0 1 2 3 Cash Flow (1) Cash Flow (II) -$59,000 -$ 18,500 26,900 9,950 26,900 9,950 26,900 9,950 a-1.If the required return for both projects is 12 percent, what is the profitability index for both projects? (Do not round intermediate calculations and round your answers to 3 decimal places, e.g., 32.161.) a. If the company applies the profitability index decision rule, which project should the 2. firm accept? b-1. What is the NPV for both projects? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) b- If the company applies the NPV decision rule, which project should it choose? 2. a-1. Project I profitability index Project II profitability index a-2. Profitability index decision b-1. Project INPV Project II NPV b-2. NPV decision

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