Problem 11-10 Capital budgeting criteria: mutually exclusive projects A firm with a WACC of 10% is considering the following mutually exclusive projects: 0 1 2 3 4 5 Project 1 -$300 $40 $40 Project 2 -$650 $300 $300 Which project would you recommend? Select the correct answer. $40 $55 $190 $55 $190 55 O I. Neither A or B, since each project's NPV NPV2. III. Project 2, since the NPV2 > NPV1. IV. Both Projects 1 and 2, since both projects have IRR's > 0. V. Both Projects 1 and 2, since both projects have NPV's > 0. O