#10)

Suppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of this risk class is 7 percent, and that the maximum allowable payback and discounted payback statistics for the project are 3.5 and 4.5 years, respectively.

Time:	0	1	2	3	4	5	6
Cash flow:	$4,800	$1,210	$2,410	$1,610	$1,610	$1,410	$1,210

Use the PI decision rule to evaluate this project.

PI=