The Sloan Corporation is trying to choose between the following two mutually exclusive design projects: Annual cash flows: Year 0 Year 1 Year 2 Year 3 Required return $ (51,000) 23,500 23,500 $23,500 SASASAGA $ $ $ $ $ 11 (14,000) 8,000 8,000 8,000 11% a. If the required return is 11 percent and the company applies the profitability index decision rule, which project should the firm accept? b. If the company applies the NPV decision rule, which project should it take? c. Explain your answers in (a) and (b).

The Sloan Corporation is trying to choose between the following two mutually exclusive design projects: a. If the required return is 11 percent and the company applies the profitability index decision rule, which project should the firm accept? b. If the company applies the NPV decision rule, which project should it take? c. Explain your answers in (a) and (b). (a. 4%, b. 4%, c. 3%, all: 10% )