Question 2 Project Selection Dragon Products Company is considering two projects. The projects' cash flows are as follows: EXPECTED NET CASH FLOWS YEAR PROJECT A PROJECT B 0 ($9300) (17,600) 1 2700 3870 2 1930 2450 3 1500 4700 4 2800 4575 3200 2450 Discount Rate for both pojects = 7.5% REQUIRED 1. Find the Payback Period of both projects 2. What is the discounted PBP of both projects ? 3. Calculate the Net Present Value of the two projects and decide which one is better? 4. What is the profitability index of both produets? 5. What is the IRR of the project A only? 6. Why is sunk cost not considered when deciding about selecting a project? Which cost is considered and why? [60 marks]