There are 2 projects: Project A and Project B. Each project has initial investment cost is Rs. 100,000 and cost of capital for each project is 12%. The expected cash flows of projects are as:

YearProject AProject B0Rs. (100,000)Rs. (100,000)165,00035,000230,00030,000330,00030,000410,00010,000

a) Calculate Payback Period (PBP) for each project? And also recommend on of the project on the basis of PBP.

b) Calculate NPV for each project? And also recommend on of the project on the basis of NPV.

c) Calculate IRR for each project? And also recommend on of the project on the basis of IRR.

d) If both the projects are independent then, which project is accepted on the basis of NPV Calculated in part 'b'.

e) If both the projects are mutually exclusive projects then, which project is accepted on the basis of NPV Calculated in part 'b'.