1.

What is the payback period for the following set of cash flows?

Year	Cash Flow
0	$ 8,000
1	2,800
2	1,000
3	2,900
4	2,100

Multiple Choice

• 3.57 years

• 3.80 years

• 3.64 years

• 3.92 years

• 3.62 years

2.

An investment project provides cash inflows of $650 per year for 8 years.

a. What is the project payback period if the initial cost is $3,250?

b. What is the project payback period if the initial cost is $3,575?

c. What is the project payback period if the initial cost is $5,850?

3.

For the following set of cash flows,

Year	Cash Flow
0	$8,000
1	4,800
2	3,500
3	5,200

a. What is the NPV at a discount rate of 0 percent?

b. What is the NPV at a discount rate of 15 percent?

c. What is the NPV at a discount rate of 23 percent?

d. What is the NPV at a discount rate of 28 percent?