Two mutually exclusive projects are under consideration. Cash flows are shown below. The companies MARR is 10%.

Year Project A Project B 0 -$6,000 -$10,000 1 2,700 1,000 2 2,700 3,000 3 2,700 6,000 4 2,700 7,000 5 2,700 9,000

(a) What is the payback of each project and which should be selected if the simple payback method is used to make the determination?

(b) Which project should be selected using benefit cost ratio?

(c) Explain any differences in results.

Two mutually exclusive projects are under consideration. Cash flows are shown below. The companies MARR is 10%. Year 0 1 2 Project A -$6,000 2,700 2,700 2,700 2,700 2,700 Project B -$10,000 1,000 3,000 6,000 7,000 9,000 3 4 5 (a) What is the payback of each project and which should be selected if the simple payback method is used to make the determination? (b) Which project should be selected using benefit cost ratio? (c) Explain any differences in results. Two mutually exclusive projects are under consideration. Cash flows are shown below. The companies MARR is 10%. Year 0 1 2 Project A -$6,000 2,700 2,700 2,700 2,700 2,700 Project B -$10,000 1,000 3,000 6,000 7,000 9,000 3 4 5 (a) What is the payback of each project and which should be selected if the simple payback method is used to make the determination? (b) Which project should be selected using benefit cost ratio? (c) Explain any differences in results