QUESTION $10$

Project A would cost $$45,799\mathrm{.}00$ today and have the following other expected cash flows: $$28,224\mathrm{.}00$ in $1$ year, $$19,139\mathrm{.}00$ in $2$ years, $$4,794\mathrm{.}00$ in $3$ years, and $$2,982\mathrm{.}00$ in $4$ years. The cost of capital for project A is $11\mathrm{.}05$ percent. Project B would cost $$97,512\mathrm{.}00$ today and have the following other expected cash flows: $$55,993\mathrm{.}00$ in $1$ year, $$24,781\mathrm{.}00$ in $2$ years, $$27,043\mathrm{.}00$ in $3$ years, and $$2,490\mathrm{.}00$ in $4$ years. The cost of capital for project B is $7\mathrm{.}61$ percent

Statement $1$: Project A would be accepted based on the project's internal rate of return $($IRR$)$ and the IRR rule

Statement $2$: Project B would be accepted based on the project's payback period and the payback rule if the payback threshold is $2\mathrm{.}65$ years

Statement $1$ is false and statement $2$ is true

Statement $1$ is false and statement $2$ is false

Statement $1$ is true and statement $2$ is true

Statement $1$ is true and statement $2$ is false