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A firm has three investment opportunities. Each costs $1,000, and the firm's cost of capital is 10 percent. The cash inflow of each investment is

A firm has three investment opportunities. Each costs $1,000, and the firm's cost of capital is 10 percent. The cash inflow of each investment is as follows:(7 pts total)

cash inflowABC

year

1$300500100

2300400200

3300200400

4300100500

  1. If the net present value method is used, which investment(s) should the firm make?(2 pts)
  2. What is the internal rate of return of investment A, B and C? Which investment(s) should the firm make?(3 pt.)
  3. What is the payback period for each investment?(2 pt.)

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