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PART 1

Please solve both the questions using MS EXCEL

Question 1

A firm whose cost of capital is 10% is considering two mutually exclusive projects X and Y, the details of which are:

Year                 Project X                     Project Y

Cost                  0                       Rs. 70,000                   Rs. 70,000

Cash Inflows        1                      Rs. 10,000                   Rs. 50,000

                        2                      Rs. 20,000                   Rs. 40,000

                        3                      Rs. 30,000                   Rs. 20,000

                        4                      Rs. 45,000                   Rs. 10,000

                        5                      Rs. 60,000                   Rs. 10,000

Compute the Net Present Value at 10%, Profitability Index, and Internal Rate of Return of the two projects.

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