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Question 23 (5 points) Two mutually exclusive projects have the following projected cash flows: Project A Project B Year Cash Flow Cash Flow 0 -

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Question 23 (5 points) Two mutually exclusive projects have the following projected cash flows: Project A Project B Year Cash Flow Cash Flow 0 - $50,000 -$50,000 1 15,625 0 2 15,625 0 3 15,625 0 4 15,625 0 5 15,625 99,500 If the required rate of return on these projects is 10%, which would be chosen and why? a) Both projects because they both have a higher NPV b) Project B because it has the higher NPV c) Project A because it has the higher NPV d) Neither, because both have a negative NPV

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