Question: A firm with a 10% WACC is evaluating two projects for this year's capital budget. After-tax cash flows are as follows: Year 1 Year 2

A firm with a 10% WACC is evaluating two projects for this year's capital budget. After-tax cash flows are as follows: Year 1 Year 2 Year 3 Time 0 Year 4 Year 5 - 6,000 2.000 2,500 Project A Project B 3,000 5,600 4,000 7,200 4,500 8,000 -18.000 5,600 7,000 Question #22: If the projects are mutually exclusive, which would your recommend and why? O "Adue to lower payback period O "A due to higher IRR O "B" due to higher NPV "B" due to lower MIRR

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