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Complete the following table and compute the project's conventional payback period. For full credit, complete the entire table. Year 1 Year 2 Year 3 Year
Complete the following table and compute the project's conventional payback period. For full credit, complete the entire table. Year 1 Year 2 Year 3 Year Expected cash flow 5,500,000 $2,200,000 $4,675,000 $1,925,000 Cumulative cash flow Conventional payback period The conventional payback period ignores the time value of money, and this concerns Green Caterpillar's CFO. He has now asked you to compute Sigma's discounted payback period, assuming the company has a 8% cost of capital. Complete the following table and perform any necessary calculations. Round the discounted cash flow values to the nearest whole dollar, and the discounted payback period to the nearest two decimal places. For full credit, complete the entire table. Year 1 Year 2 Year 3 Year Cash flow 5,500,000 $2,200,000 $4,675,000 $1,925,000 Discounted cash flow Cumulative discounted cash flow Discounted payback period which version of a project's payback period should the CFO use when evaluating Project Sigma, given its theoretical superiority? O The discounted payback period O The regular payback period
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