JKL Industries is evaluating two projects Both projects require an initial investment of $200,000 The expected cash flows are as follows Year Project R (USD) Project S (USD) 0 (200,000) (200,000) 1 60,000 70,000 2 70,000 80,000 3 80,000 90,000 4 90,000 100,000 5 100,000 110,000 Requirements a Calculate the payback period for both projects b Compute the NPV for both projects assuming a discount rate of 10 c Based on the NPV, which project should JKL Industries select

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Question: JKL Industries is evaluating two projects. Both projects require an initial investment of $200,000. The expected cash flows are as follows: Year Project R (USD)

JKL Industries is evaluating two projects. Both projects require an initial investment of $200,000. The expected cash flows are as follows:

Year	Project R (USD)	Project S (USD)
0	(200,000)	(200,000)
1	60,000	70,000
2	70,000	80,000
3	80,000	90,000
4	90,000	100,000
5	100,000	110,000

Requirements: a. Calculate the payback period for both projects. b. Compute the NPV for both projects assuming a discount rate of 10%. c. Based on the NPV, which project should JKL Industries select?

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