Josh Inc. has invested in a gold mining operation that costs $75 million with an expected life of 5 years. In the first two years, the project generates an annual cash inflow of $120 million. In the third year, Josh Inc. needs to consider extensive environmental and site restoration generating a cash outflow of $100 million for that year. In the final two years of the operation, cash inflows of $135 million and $150 million are generated respectively. Which of the following answers best applies to this project?

Select one:

a.

Josh Inc.s cash flows are conventional, and hence the NPV and IRR capital budgeting methods will give the same decision.

b.

Josh Inc.s cash flows are non-conventional, and hence the NPV and IRR capital budgeting methods will give the same decision.

c.

Josh Inc.s cash flows are non-conventional, and hence the NPV and IRR capital budgeting methods may conflict. If in doubt, use the NPV method.

d.

Josh Inc.s cash flows are conventional, and hence the NPV and IRR capital budgeting methods may conflict. If in doubt, use the NPV method.