You are considering investing in two independent projects "A" and "B". Project A requires

an initial investment of $12,000. In one year, there is a 30% chance of a $10,500 return;

a 50% chance of a $12,500 return; and a 20% chance of a $14,500 return. Project B

requires an initial investment of $1,000. In one year, there is a 25% chance of a $950

return; a 25% chance of a $1,000 return; and a 50% chance of a $1,200 return. If you

require a 7% return on your investment after one year, you should:

A. Accept A and reject B

B. Accept B and reject A

C. Accept both projects

D. Reject both projects

E. Undeterminable