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A firm is considering two projects that are contingent. The cash flows for the two projects are shown below: YEAR 0 1 2 3 4

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A firm is considering two projects that are contingent. The cash flows for the two projects are shown below: YEAR 0 1 2 3 4 PROJECT A -50 20 20 15 10 PROJECT B -60 25 15 25 7 If the cost of capital is 11%, what is the correct decision for the firm? Accept both projects. Reject both projects. Accept project A and reject project B. Reject project A and accept project B

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