Quark Industries has three potential projects, all with an initial cost of $2300,000. The capital budget for the year will allow Quark to accept only one of the three projects. Given the discount rate and the future cash flow of each project, determine which project Quark should accept.

Cash Flow

Project M

Project N

Project O

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Year 1

$600 comma 000600,000

$800 comma 000800,000

$1 comma 200 comma 0001,200,000

Year 2

$600 comma 000600,000

$800 comma 000800,000

$1 comma 000 comma 0001,000,000

Year 3

$600 comma 000600,000

$800 comma 000800,000

$800 comma 000800,000

Year 4

$600 comma 000600,000

$800 comma 000800,000

$600 comma 000600,000

Year 5

$600 comma 000600,000

$800 comma 000800,000

$400 comma 000400,000

Discount rate

7%

12%

18%