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A firm with a WACC of 10% is considering the following mutually exclusive projects: 0 1 2. 3 4 5 T + + + Project

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A firm with a WACC of 10% is considering the following mutually exclusive projects: 0 1 2. 3 4 5 T + + + Project 1 -$400 $65 $65 Project 2 -$450 $250 $250 Which project would you recommend? $65 $150 $225 $150 $225 $150 Select the correct answer. a. Both Projects 1 and 2, since both projects have NPV's > 0. Ob. Project 1, since the NPV; > NPV2. c. Project 2, since the NPV2 > NPV . Od. Neither Project 1 nor 2, since each project's NPV 0

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