Question $22$

Matt is analyzing two mutually exclusive projects of similar size. Both projects have $5-$year lives. Project A has an NPV of $$18,389,$ a payback period of $2\mathrm{.}38$ years, and an IRR of $15\mathrm{.}9$ percent. Project $B$ has an NPV of $$19,748,$ a payback period of $2\mathrm{.}69$ years, and an IRR of $13\mathrm{.}4$ percent. He can afford to fund either project, but not both. Matt should accept:

Project A because of its payback period.

both projects as they both have positive NPVs$.$

Project B based on its NPV$.$

Project A because of its IRR.