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Pina Colada Inc. is contemplating a capital investment of $98000. The cash flows over the projects four years are: Expected Annual Expected Annual Year Cash

Pina Colada Inc. is contemplating a capital investment of $98000. The cash flows over the projects four years are:

Expected Annual Expected Annual
Year Cash Inflows Cash Outflows
1 $36000 $13000
2 51000 18000
3 65000 22000
4 62000 40000

The cash payback period is

3.74 years.

3.17 years.

4.91 years.

2.26 years.

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