Project A has an outlay of $1 million and, when using a discount rate of 10% which reflects its risk, it has an NPV of 1$20 000. Project B has an outlay of $10 million and when discounted at 20%, to reflect its risk, has an NPV of 1$15 000. If A and B are mutually exclusive, which project should the firm accept?

AppendixLO1