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2 A firm is considering investing in a , project with the following cash flows: Year 1 13 14 15 16 17 3 5 6

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2 A firm is considering investing in a , project with the following cash flows: Year 1 13 14 15 16 17 3 5 6 8 Net Cash 2.000 3.000 40003500 3000 2000 1000 1000 Flow ($) The project requires an initial investment of $ 12,500 and the firm has a required rate of retum of 10 percent. Compute a) the payback b) discounted payback c) net present value and determine whether the project should be accepted

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