You have a capital constraint for one period of R1 million, your cost of capital is 12%, you could invest surplus funds at 10%, and you are analysing the following potential indivisible projects:

Project Cost NPV@12%

A R600 000 R50 000

B R500 000 R25 000

C R400 000 -R1 000

D R450 000 R45 000

E R1 000 000 R48 000

(a) Which project(s) should you invest in? Explain how you came to your decision.