CBUS 341 - Business Finance Chapter 8 - Capital Budgeting Independent versus Mutually Exclusive Projects You are evaluating two different projects for investment. Each of the projects is of equal risk and have a required rate of return of 12 percent. Management has mandated that it will accept projects that break even within 2.5 years. The expected cash flows for each project are as follows: Project A Project B Year Cash Flows Cash Flows 0 5.1.352,530 S-1,458.520 426,562 426,562 565.000 875.000 3 875,000 565.000 1.000.000 1.000.000 2 4 Compute the Payback Period for Project A. Compute the Payback Period for Project B