A decision must be made between two very high-technology projects, Project $\mathrm{X}$ and Project $\mathrm{Y}$, both with a very short life of 3 years and each having the same cost of $\$ 9,499$. The firm's normal MARR is $10 \%$. The difference is in the risk of each project, as shown below:

1. Identify which of the two projects is more risky.
2. If the riskier project has a MARR $2 \%$ higher than the company norm, what is the NPV for these projects?

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Project X Probability Net Cash Flow Project Y Probability Net Cash Flow 0.25 $5,000 0.25 $0 0.50 9,000 0.50 8,000 0.25 12,000 0.25 20,000