The treasurer of Amaro Canned Fruits, Inc., has projected the cash flows of Projects A, B, and C as follows:

a) Suppose the relevant discount rate is 12 percent per year.

b) Compute the profitability index for each of the three projects.

c) Compute the NPV for each of the three projects.

d) Suppose these three projects are independent. Which project(s) should Amaro accept based on the profitability index rule?

e) Suppose these three projects are mutually exclusive. Which project(s) should Amaro accept based on the profitability index rule?

f) Suppose Amaros budget for these projects is $450,000. The projects are not divisible. Which project(s) should Amaro accept?

YearProject A Project B Project C $225,000 $450,000-$225,000 180,000 135,000 165,000 300,000 65,000300,000