Q16

Project S requires an initial outlay at t = 0 of $12,000, and its expected cash flows would be $4,000 per year for 5 years. Mutually exclusive Project L requires an initial outlay at t = 0 of $49,500, and its expected cash flows would be $14,500 per year for 5 years. If both projects have a WACC of 15%, which project would you recommend? Select the correct answer. O a. Both Projects Sand L, since both projects have IRR's > 0. b. Project S, since the NPV5 > NPVL O c. Project L, since the NPVL > NPVs. O d. Both Projects S and L, since both projects have NPV's > 0. e. Neither Project Snor L, since each project's NPV