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Year Project A (CF) Project B (CF) 0 1 2 3 -5000 +2000 +3000 +4000 -5000 +2500 +2000 +5000 9. The cost of capital is
Year Project A (CF) Project B (CF) 0 1 2 3 -5000 +2000 +3000 +4000 -5000 +2500 +2000 +5000 9. The cost of capital is 10 percent. Under the NPV method, which is the correct statement assuming A and B are mutually exclusive? (some rounding error is ok) (a) Project A is preferable because the NPV is higher by $230. (b) Project B is preferable because the NPV is higher by $380. (c) Project A is preferable because the NPV is higher by $470. (d) Project B is preferable because the NPV is higher by $500. (e) Either A or B would be acceptable choices
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