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Consider the case of Blue Hamster Manufacturing Inc.: Blue Hamster Manufacturing Inc. is a small firm, and several of its maragers are woried about how

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Consider the case of Blue Hamster Manufacturing Inc.: Blue Hamster Manufacturing Inc. is a small firm, and several of its maragers are woried about how soon the firm will be able to recover its initial investment from Project Sigma's expected future cash fows. To answer this question, Blue Hamster's CFO has asked that you compute the project's payback period using the folowing expected net cash flows and assuning that the cash flows are received evenly throughout each year Complete the folwing table and compute the projet's conventional payback period. Forfull cedt, complete the entire table Year 0 Year 1 Year 2 Year 3 Expected cash flow Cumulative cash flow -6,000,000$2,400,000$5,100,000 $2,100,000 Conventional payback period: The conventional payback period ignores the time value of money, and this concerns Blue Hamster's cFO. He has now asked you to compute Sigma's discounted payback period, assurning the company has a 8% cost of capital, Complete the following table and perform any necessary calcu/ations., Round the mearest whole dollar,and the discounted payback period to the nearest two decimal places. For fll redit, complete the entire table discourted cash frow values to the Year 1 Year 2 Year 3 Year 0 -6,000,000 $2/400,000$5/100.000$2,100,000 Cash fow Discounted cash flow Curnulative discounted cash flow Discounted payback period: Which version of a project's payback perlod should the CFO use when evaluating Project Sigma, given its thepretical

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