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Assume a $90,000 investment and the following cash flows for two alternatives. YearInvestment XInvestment Y1 $ 25,000 $ 50,000 2 30,000 30,000 3 25,000 20,000

Assume a $90,000 investment and the following cash flows for two alternatives.

YearInvestment XInvestment Y1 $ 25,000 $ 50,000 2 30,000 30,000 3 25,000 20,000 4 20,000 5 25,000

a.Calculate the payback for investment X and Y. (Do not round intermediate calculations. Round your answers to 2 decimal places.)

Payback Investment Xyears Investment Y years

b.Which alternative would you select under the payback method?

multiple choice

Investment X

Investment Y

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