1) Calculate the discounted payback period of a project with a discount rate of 7% and these cash flows:

Period 0: -1000

Period 1: 766

Period 2: 109

Period 3: 1448

Answer in years round to the nearest hundredth.

2) 2) Find the crossover rate of projects A and B

YearProject AProject B

0-1250-475

11100350

2375200

Enter your answer in percent and round to the nearest 0.01%.

3) Machinery costs $1 million today and $100,000 per year to operate. It lasts for 2 years. What is the equivalent annual annuity if the discount rate is 7%? Enter your answer in dollars and round to the cent. Costs are negative cash flows, so please include the negative sign