ANSWER ALL QUESTIONS 1. The following data are supplied relating to two investment projects, only one of which will be selected. PROJECT A ($) PROJECT B ($) Initial Cash Outflow 100,000 100,000 Cash Inflow Year 1 50,000 20,000 Year 2 40,000 20,000 Year 3 30,000 28,000 Year 4 20,000 52,000 Estimated resale value at end of Year 4 20,000 20,000 The cost of capital is 10%. Required: 1. a) Find the Payback Period and Net Present Value for each project. (17 marks) b) Explain the benefits and limitations of the Payback Period Method and Net Present Value Method. (12 marks) 2. Illustrate the qualitative factors that should be considered in short term decision making. (21 marks)