Market Inc. is considering Projects X and Y, whose cash flows are shown below. They are asking for your advice. These projects are mutually exclusive, equally risky, and not repeatable. The CEO and CFO are at odds about which method to go with and advocate other methods. Calculate and discuss the following and make a recommendation.

WACC: 7.00% Year 2 4 CFx -$1,100 $550 $600 $100 $100 CFy -$2.750 $725 $725 $800 $1.400