Exercise 11-10 (Static) Net present value, unequal cash flows, and profitability index LO P3 Following is information on two alternative investment projects being considered by Tiger Company. The company requires a 4% return from its investments, (PV of $1. FV of $1. PVA of $1. and EVA of $1) (Use appropriate factor(s) from the tables provided.) Project x1 Initial investment Project x2 $ (80,000) $ (120,000) Net cash flows in: 25,000 60,000 Year 2 35,500 50,000 Year > 66,500 40,000 a. Compute each project's net present value b. Compute each project's profitability index c. If the company can choose only one project , which should it choose on the basis of profitability index? Year 1 Complete this question by entering your answers in the tabs below. Required A Required B Required Required A Required B Required c Compute each project's net present value. Net Cash Flows Present Value of Present Value of Net 1 at 4% Cash Flows Project X1 Year 1 Year 2 Year 3 Totals Initial investment Net present value Project X2 Year 1 Year 2 Year 3 Totals Initial investment Net present value Complete this question by entering your answers in the tabs below. Required A Required B Required Compute each project's profitability index Profitability Index Denominator: Numerator: Profitability Index Profitability index Project X 1 Project X2 b. Compute each project's profitability index c. If the company can choose only one project, which should it choose on the basis of profitability index? Complete this question by entering your answers in the tabs below. Required A Required Required If the company can choose only one project, which should it choose on the basis of profitability Index? If the company can choose only one project, which should it choose on the basis of profitability index?