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2. You are analyzing a project and have prepared the following data: Year 0 1 2 3 + Cash flow -$192.700 $ 53.200 $ 77,600

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2. You are analyzing a project and have prepared the following data: Year 0 1 2 3 + Cash flow -$192.700 $ 53.200 $ 77,600 $ 51.000 $ 26,000 Required payback period 35 years Required AAR 8 25 percent Required return 10.50 percent a. Based on the net present value of this project should you secept or reject this project? Why? Please explain. (8 points) b. Based on the payback period of this project should you accept or reject this project? Why? Please explain. 17 points) c. Based on the profitability index of this project, should you accept or reject this project? Why? Please explain. 15 points Page 10 of 11

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