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Projects A and B are mutually exclusive. The required return is 10%. Year Cash Flow (A) Cash Flow (B) 0 -20,000 -175,000 1 12,000 80,000

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Projects A and B are mutually exclusive. The required return is 10%. Year Cash Flow (A) Cash Flow (B) 0 -20,000 -175,000 1 12,000 80,000 2 10,000 35,000 3 10,000 125,000 If you apply the Pl criterion, which investment will you choose? Why? A) Both projects A and B, because Pl is greater than 1. B) Both projects A and B, because Pl is greater than 0. C) Project B, because Pl is greater than 1 and higher. D) Project A, because Plis positive and higher. E) Project A, because Pl is greater than 1 and higher

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