You are considering two mutually exclusive projects with the following cash flows. Will you choice between the two projects differ if the required rate of
return is 8 percent rather than 11 percent? If so what should you do?
Year Project A Project B
0 -$240000 -$198000
1 $0 $110800
2 $0 $82500
3 $325000 $45000
Yes; Select A at 8 percent and B at 11 percent
Yes; Select B at 8 percent and A at 11 percent
Yes; Select A at 8 percent and select neither at 11 percent
no; Regardless of the required rate project A always has the higher NVP
no; Regardless of the requried rate project B always has the higher NVP.
Please show work