Question 7 (4 points) 1. Tara is evaluating two mutually exclusive capital budgeting projects that have the following characteristics Cash Flows Year 0 1 Project $(4,000) 0 5,000 Project R $(4,000) 3,500 1,100 IRR 11.8% 12.0% If the firm's required rate of return (1) is 8 percent, which project should be purchased? Both projects should be purchased, because the IRRs for both projects exceed the firm's required rate of return Neither project should be accepted, because the IRRs for both projects exceed the firm's required rate of return Project Q should be accepted, because its net present value (NPV) is higher than Project R's NPV. Project R should be accepted, because its net present value (NPV) is higher than Project Q's NPV. Question 8 (5 points) What is the standard deviation of return for a stock with annual return of 10%, 9%, -8%, 13% over the last four years