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A firm with a WACC of 10% is considering the following mutually exclusive projects: 0 1 2 3 4 5 Project 1 -$350 $80 $80

A firm with a WACC of 10% is considering the following mutually exclusive projects: 0 1 2 3 4 5 Project 1 -$350 $80 $80 $80 $185 $185 Project 2 -$450 $250 $250 $145 $145 $145 Which project would you recommend? Select the correct answer. a. Both Projects 1 and 2, since both projects have NPV's > 0. b. Neither Project 1 nor 2, since each project's NPV < 0. c. Both Projects 1 and 2, since both projects have IRR's > 0. d. Project 2, since the NPV2 > NPV1. e. Project 1, since the NPV1 > NPV2

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