For a company XYZ, Find the discounted payback period for both the project. Who is facing the bias? Investment is 5000. Use discount rate as1 % for A and 2% for B. The cash flows are as follows: Year-1; Project A= 2000; Project B= 2000; Year-2; Project A= 2000; Project B= 2500; Year-3; Project A= 2000; Project B= 2000; Year-4; Project A= 2000; Project B= 2500.

Select one:

a. 3.05 year; 2.67 years; B shows over-confidence bias

b. 2.55 year; 2.34 years; A shows over-confidence bias

c. None of the options

d. 3.15 year; 2.59 years; A shows over-confidence bias

e. 2.55 years; 2.34 years; B shows over-confidence bias