You are considering two mutually exclusive projects with the following cash flows. Which project(s) should you accept if the discount rate is 5 percent? What if the discount rate is 11 percent?

Year	Project A	Project B
0	-80000	-80000
1	26000	32000
2	30000	28000
3	34000	24000

Answers:

a. accept B at 5 percent and A at 11 percent.

b. accept project B as it always has the higher NPV.

c. accept project A as it always has the higher NPV.

d. accept A at 5 percent and B at 11 percent.

e. accept A at 5 percent and neither at 11 percent.