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Please give formulas and how to solve! Time $40 $50 Expected Net Cash Flows Project A Project B ($300) ($300) $110 $100 $80 $90 $110

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Time $40 $50 Expected Net Cash Flows Project A Project B ($300) ($300) $110 $100 $80 $90 $110 $90 $80 $100 $70 $90 $50 $80 WACC = 10% . What is the regular payback period for these two projects? Project A Time period Cash flow Cumulative cash flow Payback 0 (300) 1 40 2 50 3 80 4 80 5 990 6 $100 $90 Project B Time period Cash flow Cumulative cash flow Payback 0 (300) 1 110 2 100 3 90 4 110 5 $80 6 $70 $50 Select Project: B if the max. acceptable payback = 2.5 years

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