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5. Projects A and B have the following cash flows: Ci C2 C3 4 A (100) 60 50 40 30 B (80) 40 50 0

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5. Projects A and B have the following cash flows: Ci C2 C3 4 A (100) 60 50 40 30 B (80) 40 50 0 (i) If a company uses the payback rule with a cutoff period of 2 years, which projects would it accept? (ii) Are these good decisions if the opportunity cost of capital is 10%

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