Question: There are two mutually exclusive projects S and L. They are equally risky, and not repeatable and their cash flows are shown below (in millions

There are two mutually exclusive projects S and L. They are equally risky, and not repeatable and their cash flows are shown below (in millions of dollars). Suppose WACC of a firm is 10% 0 1 2 3 4 Projects -$25 S5 $10 $15 $20 Project L -$25 $20 S10 $8 1) Calculate NPVs and IRRs for Project S and L. 2) Based on the calculation above, which one(s) is(are) acceptable if projects are mutually exclusive? 3) What are the traditional payback periods for both projects? $6

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