Consider the following two mutually exclusive projects:

Year	Cash FlowsA	Cash FlowsB
	R	R
0	-175 000	-20 000
1	10 000	10 000
2	25 000	5 000
3	25 000	3 000
4	375 000	1 000

You require a 15 per cent return on your investment.

(a) If you apply the payback rule, which investment will you choose? Why? (6)

(b) If you apply the NPV rule, which investment will you choose? Why? (6)

(c) If you apply the IRR rule, which investment will you choose? Why? (6)