Problem 1 (30 Marks) You are considering two investment projects, each which requires an upfront expenditure of $430,000. You estimate the cost of capital is 12% and that the investments will produce the following after-tax cash flows: a. Calculate the payback period for both projects. (4 marks) b. Calculate the discounted payback period for each of the projects. ( 4 marks) c. Calculate the net present value for each of the projects. (6 marks) d. Calculate the profitability index for each of the projects. (4 marks) e. If projects are mutually exclusive, based on Payback Period, which project(s) would you choose? Explain. (2 marks) f. If projects are mutually exclusive, based on Discounted Payback Period, which project(s) would you choose? Explain. (2 marks) g. If the projects are independent, which project(s) would you undertake? Explain. (2 marks) h. If the projects are mutually exclusive, which project(s) should the firm undertake? Explain. (2 marks) i. Based on the profitability index (PI), what is your recommendation concerning these projects if these projects are independent? Explain. (2 marks) j. Based on your calculations above, what can you conclude about the value of the Internal Rates of Return (IRRs) for both projects. Explain. (2 marks)