Moon Enterprises has a project which has the following cash flows:

Year

Cash Flow

0

-$500,000

1

150,000

2

200,000

3

350,000

4

140,000

5

225,000

1. The cost of capital is 14 percent. What is the project'sdiscounted payback?

3.10 years

2.53 years

2.91 years

2.18 years

2.64 years