1.

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

Year	Cash Flow
0	?$ 4,500
1	2,800
2	2,500
3	2,200
4	1,900

2.

An investment project provides cash inflows of $620 per year for 12 years. a)

What is the project payback period if the initial cost is 2,480?

b)

What is the project payback period if the initial cost is 4,092?

C)

What is the project payback period if the initial cost is 8,060?

3.

A firm evaluates all of its projects by using the NPV decision rule.

Year	Cash Flow
0	$25,000
1	23,000
2	15,000
3	9,000

a)

At a required return of 28 percent, what is the NPV for this project?

b)

At a required return of 34 percent, what is the NPV for this project?