You are a senior manager at Airbus and have been authorized to spend up to 200,000 for projects. The three projects you are considering have the following characteristics:

Project A: Initial investment of 158,000. Cash flow of 52,000 at year 1 and 108,000 at year 2. This is a plant expansion project, where the required rate of return is 9 per cent.

Project B: Initial investment of 200,000. Cash flow of 200,800 at year 1 and 113,000 at year 2. This is a new product development project, where the required rate of return is 19 per cent.

Project C: Initial investment of 104,000. Cash flow of 104,400 at year 1 and 102,000 at year 2. This is a market expansion project, where the required rate of return is 19 per cent. Assume the corporate discount rate is 9 per cent.

Required; Please offer your recommendations following your investment appraisal using Payback period, IRR, Incremental IRR, PI and NPV backed by your analysis of 1000 words. All calculations should be attached in an appendix at the end of your report (and do not form part of the word count).