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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 -$450 $40 $40

A firm with a WACC of 10% is considering the following mutually exclusive projects: 0 1 2 3 4 5 Project 1 -$450 $40 $40 $40 $175 $175 Project 2 -$650 $350 $350 $40 $40 $40 Which project would you recommend? Select the correct answer. a. Both Projects 1 and 2, since both projects have NPV's > 0. b. Project 2, since the NPV2 > NPV1. c. Both Projects 1 and 2, since both projects have IRR's > 0. d. Project 1, since the NPV1 > NPV2.

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