Question: Suppose you are evaluating two mutually exclusive projects, Project A and Project B, with the following cash flows: 2. End-of-year cash flows Project A Year

 Suppose you are evaluating two mutually exclusive projects, Project A and

Suppose you are evaluating two mutually exclusive projects, Project A and Project B, with the following cash flows: 2. End-of-year cash flows Project A Year Project B 2001 2002 2003 2004 2000 $10,000-$10,000 3,293 3,293 3,293 0 0 0 3,29314,641 (a) If the cost of capital on both project is 5%, which project, if any would you choose? why? (b) If the cost of capital on both project is 8%, which project, if any would you choose? Why? (c) If the cost of capital on both project is 11%, which project, if any would you choose? why? (d) If the cost of capital on both project is 14%, which project, if any would you choose? why? (e) At what discount rate would you be indifferent between choosing Project A and Project B

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