12 4 points Project A has an initial cost of $75,000 and annual cash flows of $30,000 for three years. Project B costs $60,000 and has cash flows of $25,000, $30,000, and $25,000 for Years 1 to 3, respectively. Projects A and B are mutually exclusive. The cost of capital of both projects is 12%. Which project will you choose? Both projects A, because its IRR is higher than the discount rate B, because its IRR is lower than the discount rate A, because its IRR is lower than the discount rate B, because its IRR is higher than the discount rate Previous Next