Assume the following information for four projects that last for 1 year: Projects 1 2 3 4 Initial outlay () 40,300 31,200 22,200 11,900 Cash flow at end of 1 year () 42,400 34,100 22,900 13,100 Cost of capital (%) 4% 5% 1% 7% Which ONE of the following is true? Project 3 has the lowest NPV and the lowest IRR. (Tick here if you think that none of the statements is true.) Project 1 has the highest NPV and its IRR is higher than the cost of capital. Project 2 has the highest NPV and the highest IRR. Project 4 has the lowest NPV and the highest IRR