You are choosing between two projects. The cash flows for the projects are given in the following table ($ million): a. What are the lRRs of the two projects? b. If your discount rate is 4.8%, what are the NPVs of the two projects? c. Why do IRR and NPV rank the two projects differently? (Click on the following icon. in order to copy its contents into a spreadsheet.) Project Year 0 Year 1 Year 2 Year 3 A - $49 $25 $19 $19 B - $102 $22 $41 $48 You need a particular piece of equipment for your production process. An equipment-leasing company has offered to lease the equipment to you for $9,900 per year if you sign a guaranteed five-year lease (the lease is paid at the end of each year). The company would also maintain the equipment for you as part of the lease. Alternatively, you could buy and maintain the equipment yourself. The cash flows from doing so are listed below (the equipment has an economic life of ve years). If your discount rate is 7.3%, what should you do? Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 $40,400 $2,100 -$2,100 $2,100 -$2,100 $2,100 E) The net present value of the leasing alternative is $|:|. (Round to the nearest dollar.) The CEO of Garneau Cinemas is considering making a movie and must decide between a comedy and a thrillerit doesn't have the production space to make both. The comedy is expected to cost $25 million up front (att = 0). After that, it is expected to make $17 million in the rst year (at t = 1) and $4 million in each of the following two years (att = 2 and t = 3). In the fourth year (att = 5), it is expected that the movie can be sold into syndication for $3 million with no further cash ows back to Garneau Cinemas. The thriller is expected to cost $40 million up front (at t = 0). After that, it is expected to make $20 million in the first year (at t = 1) and $3 million in each of the following four years (at t = 2, 3, 4, and 5). In the sixth year (at t = 6), it is expected that the movie can be sold into syndication for $30 million with no further cash ows back to Garneau Cinemas. The cost of capital is 11%. and Garneau usually requires projects to have a payback within four years. Determine each project's payback and NPV, and advise the CEO what she should do. <:> The payback for the comedy is D years, and the NPV of the comedy is $|:|. The payback for the thriller is El years, and the NPV of the thriller is $|:|. (Round to two decimal places as needed.) Fabulous Fabricators needs to decide how to allocate space in its production facility this year. It is considering the following contracts: : a. What are the profitability indexes of the projects? b. What should Fabulous Fabricators do? . . . a. What are the profitability indexes of the projects? The profitability index for contract A is (Round to two decimal places.)\fOrchid Biotech Company is evaluating several different development projects for experimental drugs. Although the cash flows are difficult to forecast, the company has come up with the following estimates of the initial capital requirements and NPVs for the projects. Given a wide variety of staffing needs, the company has also estimated the number of research scientists required for each development project. (All cost values are given in millions of dollars.) Initial Number of Research Project Number Capital ($) Scientists NPV ($) 10 10.1 15 19.0 W A W N III 15 22.0 IV 20 25.0 30 12 60.2 a. Suppose that Orchid has a total capital budget of $60 million. How should it prioritize these projects? b. Suppose that Orchid currently has 12 research scientists and does not anticipate being able to hire more in the near future. How should Orchid prioritize these projects