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Investment A: Year: Cash flow: 0 - $14,000 2 $4,000 3 $4,000 $4,000 $4,000 5 $4,000 Investment B: Year: 0 1 2 3 4 5

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Investment A: Year: Cash flow: 0 - $14,000 2 $4,000 3 $4,000 $4,000 $4,000 5 $4,000 Investment B: Year: 0 1 2 3 4 5 Cash flow: - $15,000 $7,000 $7,000 $7.000 $7,000 $7,000 Investment C: Year: 0 2 3 Cash flow: --$18,000 $12,000 $2,000 $2,000 $2,000 $2,000 The cash flows for three projects are shown above. The cost of capital is 7,5% If an investor decided to tako projects with a payback period two years or less, which of these projects would he tako? 5 O A Investment A OB Investment B OC. Investment D. none of these investments

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