P$1.(10$ points$)$ Two mutually exclusive investment projects are being considered. The expected cash flows are shown in the table below. The discount rate is $8\%.$ a$)$ Calculate the payback period. If the cutoff time is $3$ years, which project will you recommend? b$)$ Calculate NPV of both projects. Which project is better according to NPV$?$ c$)$ Calculate equivalent annuity of the two projects and which one is better? P$1.(10$ points$)$ Two mutually exclusive investment projects are being considered. The expected cash flows are shown in the table below. The discount rate is $\backslash (8\backslash \%\backslash ).$ a$)$ Calculate the payback period. If the cutoff time is $3$ years, which project will you recommend? b$)$ Calculate NPV of both projects. Which project is better according to NPV$?$ c$)$ Calculate equivalent annuity of the two projects and which one is better?Two mutually exclusive investment projects are being considered by a company. Data for the base

$($most likely$)$ values for the two alternatives are given below:

MARR$=10\%.$

Study period $=5$ years.

$($a$)$ Determine which project the company should invest in using the $PW$ method.

$($b$)$ By how much must the initial cost of Project $B$ be increased or decreased for the decision in

Part $($a$)$ to be reversed?

$(2$ marks$)$

$($c$)$ Uncertainties for Project A are as follows:

Salvage value is uniformly distributed between $$16,000$ and $$20,000.$

The annual profits are equal in value every year with the following probability distribution:

Assuming that all the uncertainties are mutually independent, determine the expected value and

standard deviation of the $PW$ for Project $A.$

Note: The probability distribution Uniform$(a,b)$ has

$,$ Mean $=\frac{1}{2}(a+b)$

$,$Var$=\frac{1}{12}(b-a{)}^2$

$($d$)$ Uncertainties for Project $B$ are as follows:

Salvage value follows the triangular distribution with min$=$$$8,000,$ max$=$$$12,000,$ and

mode $=$$$10,000.$

The annual profits are equal in value every year and is normally distributed with mean $=$

$$20,000$ and standard deviation $=$$$5,000.$

Assuming that all the uncertainties are mutually independent, determine the expected value and

standard deviation of the $PW$ for Project $B.$