Consider the following two projects:

Project

Year 0

C/F

Year 1

C/F

Year 2

C/F

Year 3

C/F

Year 4

C/F

Year 5

C/F

Year 6

C/F

Year 7

C/F

Discount

Rate

Alpha

79

20

25

30

35

40

N/A

N/A

15%

Beta

80

25

25

25

25

25

25

25

14%

Assume that projects Alpha and Beta are mutually exclusive. The correct investment decision and the best rationale for that decision is to

A.

invest in project Beta, since IRRB > IRRA.

B.

invest in project Beta, since NPVBeta > 0.

C.

invest in project Alpha, since NPVBeta < NPVAlpha.

D.

invest in project Beta, since NPVBeta > NPVAlpha > 0