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You are considering the following two mutually exclusive projects. The required rate of return is 10 percent for project A and 8 percent for project
You are considering the following two mutually exclusive projects. The required rate of return is 10 percent for project A and 8 percent for project B. Based on the NPV, which project should be chosen? Why or why not? Year Project A Project B 0 -$320,000 -$525,000 1 $292,000 $396,000 2 $165,000 $319,000 3 $107,000 $204,000 O Project B; because the NPV of the project B is greater than the NPV of the project A. O None; because both have the negative NPV. Project A; because the NPV of the project A is greater than the NPV of the project B. Both; because Both have the positive NPV. O Project A; because it has the higher required rate of return
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