Please select the correct answer and show steps at how you arrived at the answer

A company is analyzing two mutually exclusive projects, S and L, whose cash flows are shown below. Project S: -1,100 (Year 0), 1000 (Year 1), 350 (Year 2), 50 (Year 3). Project L: -1,100 (Year 0), 0 (Year 1), 300 (Year 2), 1,500 (Year 3). Which project should be chosen and why? (You may want to use your calculation results from the other two related questions or work on them first.)

	A.	S, because it has higher NPV, which is also positive.
	B.	Both, because both projects have positive NPV and their IRRs are both higher than cost of capital, 12 percent.
	C.	L, because it has higher NPV, which is also positive.
	D.	S, because it has higher IRR, which is also higher than the cost of capital, 12 percent.
	E.	L, because it has higher IRR, which is also higher than the cost of capital, 12 percent.