A firm with an 11% WACC is evaluating two mutually exclusive projects with the following cash flows (in millions); calculate the discounted payback for the project that maximizes shareholder value.

t = 0 1 2 3 4 5

Project S. -1,000 500 400 300 200 100

Project L -1,000 100 200 400 500 500

a. 2.87 years

b.3.04 years

c. 4.04 years

d. 4.43 years

e.3.23 years