A firm has the following capital budgeting projects that it can undertake. The firm is subject to capital rationing and has a capital budget of $250,000; the firm's cost of capital is 15 percent. Project Initial Investment Net Present Value (NPV) 1 $200,000 $350,000 2 $50,000 $40,000 3 $250,000 $360,000 If adopted, which of the projects would add value to the firm? Why? Select the BEST answer. Firms need to consider various forms or value including social and environmental value in evaluating projects O Project 3 is the best project from an NPV perspective because NPV is higher O Project 1 is the best investment because it pays back more than it cost by the largest amount O Project 2 is the worst because it returns less than the invested amount