Activity 2: Payback and NPV Question 1 Sesame Shoes Limited is appraising the financial effects of a project to develop a new range of shoes. The company requires an annual rate of return of 10% on any new project. The following information relates to this project. Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Design costs 95,000 - - - - - Sales revenue - 60,000 80,000 100,000 100,000 50,000 Variable costs - 30,000 40,000 50,000 50,000 25,000 10% discount factor 1.000 0.909 0.826 0.751 0.683 0.621 Required Calculate for the new project: a) The payback periods b) The net present value