Ouestion $2$

You are considering an investment that requires an upfront cost of $50\mathrm{.}000.$ The investment will

last for five years. In addition, you expect that the investment will generate cash flows at the end

of the following years:

a$.$ Calculate the discounted payback period for the investment, assuming a discount rate of

$10\%.$ Show your calculations.

b$.$ Calculate the average accounting return for the investment. Show your calculations.

c$.$ Calculate the profitability index for the investment, assuming a discount rate of $10\%.$

Show your calculations.