PLEASE ANSWER QUESTION #1 AND #2

#1

#2 - H1 ONLY (PROJECT A AND B)

Consider the following projects: Assume that the projects are mutually exclusive and that the opportunity cost of capital is 8%. a. Calculate the profitability index for each project. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Answer is complete but not entirely correct. b-1. Calculate the profitability-index using the incremental cash flows. (Do not round intermediate calculations. Round your answer to 2 decimal places.) Answer is complete but not entirely correct. b-2. Which project should you choose? Project D Project E Consider the following two projects: a. If the opportunity cost of capital is 7%, which of these two projects would you accept ( A, B, or both)? b. Suppose that you can choose only one of these two projects. Which would you choose? The discount rate is still 7%. c. Which one would you choose if the cost of capital is 12% ? d. What is the payback period of each project? e. Is the project with the shortest payback period also the one with the highest NPV? f. What are the internal rates of return on the two projects? g. Does the IRR rule in this case give the same answer as NPV? h-1. If the opportunity cost of capital is 7%, what is the profitability index for each project? h-2. Is the project with the highest profitability index also the one with the highest NPV? h-3. Which measure should you use to choose between the projects