7.5 Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) -$200,000 $20,000 1 15,000 12,000 30,000 11,000 3 32,000 10,000 4 400,000 9,000 Whichever project you choose, if any, you require a 15 percent return on your investment. a. (2 points) If you apply the payback criterion, which investment will you choose? Why? b. (2 points) If you apply the NPV criterion, which investment will you choose? Why? c. (2 points) If you apply the IRR criterion, which investment will you choose? Why? (note the IRR of the two projects are 26.96% and 40.60%, you just have to show me which one is which) d. (2 points) If you apply the profitability index criterion, which investment will you choose? Why? e. (2 points) Based on your answers in (a) through (d), which project will you finally choose? Why