Consider once again the sample project shown in Table 13.2. As we calculated in Example 13-1 , that project has a PB statistic of 2.8 years. Now, compare that project to the one shown in Table 13.5.

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TABLE 13.5 Payback Calculation on Alternative Sample Project with Normal Cash Flows Year: Cash flow 0 1 2 3 4 5 -$10,000 $2,500 $3,500 $4,000 $104,000 $102,000 0 Cash flow present value -10,000 -7,500 -4,000 0 0