The following two mutually exclusive projects are being evaluated. The firm's required rate of return is 12%. Year Project A Cash Flow Project B Cash Flow 0 -$85,000 -$136,000 1 42,500 43,350 2 42,500 43,350 3 42,500 43,350 4 43,350 5 43,350 Which of the following statements best describes projects A and B?

The following two mutually exclusive projects are being evaluated. The firm's required rate of return is 12%. Year Project A Cash Flow Project B Cash Flow 0 -$85,000 -$136,000 1 42,500 43,350 2 42,500 43,350 3 42,500 43,350 4 43,350 5 43,350 Which of the following statements best describes projects A and B? O Both projects should be accepted because they have positive NPVs and EAAs. Neither project is acceptable. Project B should be accepted because it has the highest NPV. O Project A should be accepted because it has the highest EAA. O Project B should be accepted because it has the highest EAA