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You are considering the following two mutually exclusiveprojects. Project A Project B Year 0 -$10,000 -$20,000 Year 1 $3,000 $ 5,000 Year 2 $ 8,000 $ 7,000 Year 3 $ 4,000 $12,000 Year 4$ 2,000 $10,000 The required return on each project is 12 percent.Which project should you accept and what is the best reason forthat decision? a. Project B; because it has the higher net presentvalue b. Project A; because it pays back faster c. Project A;because it has the higher net present value d. Project B; becauseit has the higher profitability index e. Project A; because it hasthe higher profitability index
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