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

Year	Project A ($)	Project B ($)	Project C ($)
0	-150,000	-300,000	-150,000
1	110,000	200,000	120,000
2	110,000	200,000	90,000

Suppose the relevant discount rate is 12% per year.

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

b) Computer the NPV for each of the three projects.

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

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

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