29 - e

Your firm is considering one of two projects for investment. Project A costs $14,000 and wil bring cash flows of $3,040 for 7 years. Ptoject B costs $12,000 and will yleld cash flows of $4,050 for 4 years. Given that these two projects do not have the same productive lives and your firm's cost of capital is 4%, which project should you select and why? Because its equivalent annual beneft is higher, choose project A Becasse the initial investment is lowet, choose project A Because its equivalent annual beneft is Nigher, choose project B Because is NPV is higher, thoose project B Because its NPV is higher, choose project A