The Selected Space Searching and Survey System is considering two projects for the same piece of property. They can build a Landing Vehicle (Project "L") or they can build a Survey Spacecraft (Project "S"), but they cannot build both on this same lot (that is, they are "mutually exclusive"). The cash flows associated with each project are listed below. The firm requires a 12% return on projects of this type and risk. Cash flows in parentheses "(x)" are negative, i.e., outflows.

Which project IF ANY should SSSSS build?

a.) BOTH projects should be built.

b.) NEITHER project is acceptable.

c.) PPPPP should build Project L.

d.) PPPPP should build Project S.

e.) We cannot tell which is best unless we know the decisions rules they use for each capital budgeting method.

Year Project L Project S 0 ($1,000) ($80) 1 500 40 2 400 30 3 300 30 4 100 20