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 $180 $180 Project 2 -$550 $300 $300 $60 $60 $60 Which project would you recommend? Select the correct answer.

a. Both Projects 1 and 2, since both projects have NPV's > 0.

b. Project 1, since the NPV1 > NPV2.

c. Neither Project 1 nor 2, since each project's NPV < 0.

d. Both Projects 1 and 2, since both projects have IRR's > 0.

e. Project 2, since the NPV2 > NPV1.