(a)Mapinduzi Limited is considering two capital projects with a cost of capital 15 percent an d...

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(a)Mapinduzi Limited is considering two capital projects with a cost of capital 15 percent an d the following cash flow patterns (Figures in million shillings): Time Project A Project B 0 (ii) 0 -100 -50 1 25 10 2 30 15 3 40 25 4 30 15 5 25 15 Compute the NPV for each of the projects Which project(s) would you recommend to Mapinduzi Limited if they are indep endent? Why? Which project(s) would you recommend to Mapinduzi Limited if they were mut ually exclusive? Why? (b) What are the three (3) key flaws of payback period as an investment appraisal tec hnique? The finance literature shows that despite those flaws, payback is one of the most used appraisal technique in capital budgeting. Elucidate this showing the reaso ns behind this practice. (a)Mapinduzi Limited is considering two capital projects with a cost of capital 15 percent an d the following cash flow patterns (Figures in million shillings): Time Project A Project B 0 (ii) 0 -100 -50 1 25 10 2 30 15 3 40 25 4 30 15 5 25 15 Compute the NPV for each of the projects Which project(s) would you recommend to Mapinduzi Limited if they are indep endent? Why? Which project(s) would you recommend to Mapinduzi Limited if they were mut ually exclusive? Why? (b) What are the three (3) key flaws of payback period as an investment appraisal tec hnique? The finance literature shows that despite those flaws, payback is one of the most used appraisal technique in capital budgeting. Elucidate this showing the reaso ns behind this practice.