Estimate the payback period and discounted payback period for the following cash flows with a discount rate of 7%.

Data

• Year: Initial investment, 1, 2, 3, 4, 5
• Net Cash Flows per Year: -130000, 25000, 30000, 35000, 40000, 45000
• Cumulative Net Cash Flows: -130000, -105000, -75000, -40000, 0, 45000

Requirement

• Payback period
• Discounted Payback period