Here are the expected cash flows for three projects:

cash flows (dollars)

Project Year : 0 1 2 3 4

A --5,500 +1,125 +1,125 +3,250 0

B --1,500 0 +1,500 +2,250 +3,250

C --5,500 +1,125 +1,125 +3,250 +5,250

a. what is the payback period on each of the project?

Project Payback period

A ___________years

B ___________years

C ____________years

b. if you use a cutoff period of 2 years, which projects would you accept?

Project A

Project B

Project C

Project A and B

Project B and C

Project A and C

Projects A, B, and C

None

c. If you use a cutoff period of 3 years, which projects would you accept?

Project A

Project B

Project C

Project A and B

Project B and C

Project A and C

Projects A, B, and C

None

d-1 If the opportunity cost of capital is 11%, calculate the NPV for projects A, B, and C. (Negative amounts should be indicated by a minus sign. Do not round intermediate calcualtions. Round your answers to 2 decimal places.)

Project NPV

A $___________

B $___________

C $___________

d-2 Which projects have a positive NPVs?

Project A

Project B

Project C

Project A and B

Project B and C

Project A and C

Projects A, B, and C

None

e. "Payback gives too much weight to cash flows that occur after the cutoff date" (True or False)