You are considering two mutually exclusive projects with the following cash flows. The required return for both projects is 16 percent. Given this information, which one of the following statements is correct?

Year Project A Project B

0 -$128,000 -$124,000

1 46,000 50,000

2 79,000 30,000

3 51,000 110,000

Question 11 options:

You should accept Project A and reject Project B based on their respective NPVs.

You should accept Project B and reject Project A based on their respective NPVs.

You should accept Project A and reject Project B based on their respective IRRs

You should accept both projects based on both the NPV and IRR decision rules