Suppose your firm is considering two mutually exclusive, required projects with the cash flows shown below. The required rate of return on projects of both of their risk class is 8 percent, and that the maximum allowable payback and discounted payback statistic for the projects are 2 and 3 years, respectively.

0 1 10,000 2 30,000 3 1,000 -20,000 Time: Project A Cash Flow Project B Cash Flow -30,000 10,000 20,000 50,000 Use the NPV decision rule to evaluate these projects; which one(s) should it be accepted or rejected? Multiple Choice accept neither A nor B accept both and B accept A, reject B reject A, accept B