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You have been provided die fellow information for a mutually exclusive capital budgeting problem {all eaah ows are expressed in dollars [$}:: Project A I'rejcct

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You have been provided die fellow information for a mutually exclusive capital budgeting problem {all eaah ows are expressed in dollars [$}:: Project A I'rejcct B Period Cash Flow Period Cash Flow 0 430,000 0 430,000 1 230,000 1 "0,000 2 \"0,000 2 130,000 3 I24,000 3 240,000 4 94,000 4 200.000 The comFanjr has a required rate of return of 12 percent. Clearly label your work and show your calculationsl 1. Calculate the payback period for both projecta. It'll mach] 2. Calculate the discounted payback period for each of the projects. [4 marks] 3. Calculate the net present value for each of the projects. [4 make] 4. Calculate the protability index for each of the projects. [4 maria] 5. Complete the following table: 14 marks} \"mm\" 6. Was the same project accepted [or all the evaluation techniclucalll lives, which project should he accepted? If no, why and when do the inherent evaluation methods select different projects and which projects should be accepted? [3 marks] 'i'. 1.l'iihat is the Internal Rate of Return [IRE] of a project. Under what circumstances is this technique unreliable? {3 marks]

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