Treat Ltd has 100,000 to invest in equipment for one project. than its The finance team has worked out the following projections for two potential investment opportunities: Project A Project B Profit in year 1 10,000 15,000 Profit in year 2 15,000 11,000 Profit in year 3 20,000 18,000 Profit in year 4 22,000 17,000 It is estimated that, irrespective of which project is chosen, the equipment used can be sold at the end of Year 4 for 40,000 The yearly profit includes a depreciation of 15,000. Treat Ltd uses a cost of capital of 12%. a. Calculate the annual rate of return (ARR) for both projects. (4 marks) b. Calculate the payback period for both projects in days