as under Year 2 4 5 6 7 8 9 10 11 12 13 14 15 Project P Project 15,000 19.050 39,000 49.530 37.500 47.625 52,000 66,040 61,000 71,980 111,000 136 530 73,500 90.405 88,200 108 486 101,700 125,091 126,100 158,886 129,800 163 548 133,330 167,996 194,850 235,769 188,260 227,795 179,230 216,868 Analyze which project is better for the company. Problem 4 (25 marks): A company has to make a choice between two projects namely P& Q. The initial capital outlay of two projects are $465,000 and $598,000 respectively for P and . There will be no scrap value at the end of the life of both the projects. The opportunity cost of capital of the company is 13%. The annual income is as under: Year 1 2 3 4 5 Houston O 7 8 Project P 15,000 39,000 37,500 52,000 61,000 111,000 73,500 88,200 101,700 126,100 129,800 133,330 194,850 188,260 179,230 Project 19,050 49,530 47,625 66,040 71.980 136,530 90,405 108,486 125,091 158,886 163,548 167,996 235,769 227,795 216,868 9 10 11 12 13 14 15 Analyze which project is better for the company