Problems Chapter 11 PROBLEM1 Winston Clinic is evaluating a project that costs $52,125 and has expected net cash flows of S12,000 per year for eight years. The first inflow occurs one year after the cost outflow, and the project has a cost of capital of 12 percent. a. What is the project's payback? b. What is the project's NPV? Its IRR? e. Is the project financially acceptable? Explain your answer. PROBLEM 2 Better Health, Inc., is evaluating two investment projects, each of which requires an up-front expenditure of S1.5 million. The projects are expected to produce the following net cash inflows: Year Project A Project B 0 -$1,500.000 $1,500.000 I $500.000 $2,000.000 2 $1,000.000 $1,000.000 S600.000 3 $2,000.00 a. What is each project's IRR? b. What is each project's NPV if the cost of capital is 10 percent? 5 percent? 15 percent