Multiple choice

A firm is considering the following twomutually exclusiveprojects:

Project X

Initial Investment (I_X) = $100

CF^X₁= $150

Project Y

Initial Investment (I_Y) = $500

CF^Y₁= $625

A If the firm's cost of capitalk = 20%, which project(s) should be selected -X, Y, Neither, or Both?

B X

C Y

D Neither

E Both