Two Mutually Exclusive Projects with the Same Service Lives of 2

Multiple Choice

Two mutually exclusive projects with the same service lives of 2 years are characterized by first costs of $100 million and $120 million respectively and annual savings of $60 million and $70 million respectively. If the MARR is 10%, which one should be chosen on the basis of the present worth comparison method?

A) The second one because it has higher annual savings.
B) The first one because its present worth is higher.
C) The second one because its present worth is higher.
D) The first one because incremental present worth is positive.
E) Neither because both produce negative present worth.