1. Two projects being considered by a firm are independent and have the following projected cash flows: Project A Project B ($100,000) ($100,00) 50,000 50,000 50,000 Year 0 1 2 3 0 200,000 If the cost of the capital is 9%, which project(s) should be accepted? Neither of them 0 Project A, because it has a shorter payback period. Both should be accepted because both projects have positive NPVs Project B, because it has a higher IRR.

1. Two projects being considered by a firm are independent and have the following projected cash flows: If the cost of the capital is 9%, which project(s) should be accepted? Neither of them Project A, because it has a shorter payback period. Both should be accepted because both projects have positive NPVs Project B, because it has a higher IRR