Projects A and B are mutually exclusive. The required return on each project is 11 percent. Which project should you accept and what is the best reason for that decision?
Project A Project B
Year 0 -$15,000 -$15,000
Year 1 $9,000 $3,000
Year 2 $8,000 $5,000
Year 3 $5,000 $9,000
Year 4 $4,000 $11,000
A.Project A; because it has the higher net present value
B.Project B; because it has the higher profitability index
C.Project A; because it has the higher profitability index
D.Project A; because it pays back faster