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In your role as a financial analyst, you are evaluating two mutually exclusive projects whose projected cash flows are shown below Assume the appropriate WACC

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In your role as a financial analyst, you are evaluating two mutually exclusive projects whose projected cash flows are shown below Assume the appropriate WACC (discount rate) for each of these projects is 12% Year Project A Cash Flows Project B Cash Flows 0 -$1,200 -$1,450 1 $450 $395 2 3 $480 $440 $590 $500 4 $390 $650 Which of the following statements is CORRECT? O a. The company should aaccept both projects because at a WACC of 12% both project's Net Present Value (NPV) is positive. O b. The company should accept Project B because at a discount rate of 12%, Project B has a higher Net Present Value (NPV) than Project A Oc. The company should reject both projects due to negative Net Present Values (NPVS) at a discount rate of 12% Od. The company should accept Project A because at a discount rate of 12%, Project A has a higher Net Present Value (NPV) than Project B Oe. The WACC (discount rate) at which these two project's Net Present Values (NPVS) equal (the crossover rate) is 12.26%

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