TUTORIAL SHEET-9 UHU-081(ENGINEERING ECONOMICS) DATE:1" NOVEMBER,2012 Question -1 Bob Sponge has been retained as a management consultant by Square Pants, Inc., a local speciality retailer, to analyze two proposed capital investment projects, projects Xand Y. Project X is a sophisticated working capital and inventory control system based upon a powerful personal computer, called a system server, and PC software specifically designed for inventory processing and control in the retailing business. Project Y is a similarly sophisticated working capital and inventory control system based upon a powerful personal computer and general- purpose PC software. Each project has a cost of $10,000, and the cost of capital for both projects is 12%. The projects= expected net cash flows are as follows: Expected Net Cash Flow Year Project X Project Y AWNNO ($10, 000) ($10,000) 6,500 3,500 3,000 3,500 3,000 3,500 1,000 3,500