You are evaluating the following two mutually exclusive projects:

Project Year 0 Year 1 Year 2 A -$100 $80 $160 B -$50 $50 $120

Both have 15% cost of capital. Using NPV profiles for Projects A and B, determine which project would be chosen under each of IRR rule and NPV rule. (Hint: Draw the NPV profiles.)

Group of answer choices

Cannot be determined.

B under both IRR and NPV rules

A under IRR rule, and B under NPV rule

A under both IRR and NPV rules

B under IRR rule, and A under NPV rule