As the director of capital budgeting for ABC Corporation, you are evaluating two mutually exclusive

As
the director of capital budgeting for ABC Corporation, you are
evaluating two mutually exclusive projects with the following net cash
flows:

Cash Flows

A B

-$200,000 -$125,000

1 $65,000 $60,000

2 $60,000 $40,000

3 $50,000 $40,000

4 $65,000 $35,000

5 $50,000 $45,000

If ABC Corporation’s cost of capital is 12 percent, defend which project would you choose.