Nader International is considering investing in two assets—A and B. The initial outlay, annual cash fl ows, and annual depreciation for each asset appears in the table below for the assets’ assumed fi ve-year lives. Nader will use straight-line depreciation over each asset’s fi ve-year life. The fi rm requires a 12 percent return on each of those equally risky assets. Nader’s maximum payback period is 2.5 years, its maximum discounted payback period is 3.25 years, and its minimum accounting rate of return is 30 percent. Asset A Asset B Initial Outlay (CF0 ) $200,000 $180,000 Year (t) Cash Flow (CFt ) Depreciation Cash Flow (CFt ) Depreciation 1 $ 70,000 $40,000 $80,000 $36,000 2 80,000 40,000 90,000 36,000 3 90,000 40,000 30,000 36,000 4 90,000 40,000 40,000 36,000 5 100,000 40,000 40,000 36,000 a. Calculate the accounting rate of return from each asset, assess its acceptability, and indicate which asset is best, using the accounting rate of return. b. Calculate the payback period for each asset, assess its acceptability, and indicate which asset is best, using the payback period. c. Calculate the discounted payback for each asset, assess its acceptability, and indicate which asset is best, using the discounted payback. d. Compute and contrast your fi ndings in parts (a), (b), and (c). Which asset would you recommend to Nader, assuming that they are mutually exclusive? Why?