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A project has an initial cost of $1,800 and cash flows of $700, $1,100, and $900 for years 1 to 3, respectively. The discount rate
A project has an initial cost of $1,800 and cash flows of $700, $1,100, and $900 for years 1 to 3, respectively. The discount rate is 8 percent. Should the project be accepted or rejected according to discounted payback (DPB) if the maximum allowable period is two years?
Rejected; DPB = 2.29 years
Accepted; DPB = 2.00 years
Accepted: DPB = 2.12 years
Rejected: DPB = 2.34 years
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