You have also been asked for your views on two unrelated sets of projects. Each set of projects involves two mutually exclusive projects. These projects follow. Caledonia is considering two investments with 1-year lives. The more expensive of the two will produce more savings. Assume these projects are mutually exclusive and that the required rate of return is 10 percent. Given the following free cash flows: Calculate the NPV for each project. Calculate the PI for each project. Calculate the IRR for each project. If there is no budget (resource) constraint, which project should be selected? If there is a budget (resource) constraint, how should the decision be made? The question is what you do with the freed up $1,005,000. If other alternative projects and Project A earn more than what you would have earned in Project B alone, then choose Project A and other alternative projects. Otherwise, choose Project B