Nicholson Roofing Materials Inc. is considering two mutually exclusive projects that both cost $150,000. The company's board of directors has set a maximum four-year payback requirement, the cost of capital is 9%. The project cash flows appear below.
	Cash inflows (CFt)
Year	Project A		Project B
1	$ 45,000		$ 75,000
2	45,000		60,000
3	45,000		30,000
4	45,000		30,000
5	45,000		30,000
6	45,000		30,000
a. Calculate the payback period for each project.
b. Calculate the NPV of each project at 0%.
c. Calculate the NPV of each project at 9%.
d. Derive the IRR of each project.
e. Rank the projects by each of the techniques used. Make and justify a recommendation.
f. Go back one more time and calculate the NPV of each project using a cost of capital of 12%. Does the ranking of the two projects change compared to your answer in part e? Why?