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Project A B -2,600 -5,200 -6,500 Cash Flows ($) Ci C2 2,600 0 2,600 2,600 2,600 2,500 C3 0 5,600 0 C4 0 2,600 2,600

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Project A B -2,600 -5,200 -6,500 Cash Flows ($) Ci C2 2,600 0 2,600 2,600 2,600 2,500 C3 0 5,600 0 C4 0 2,600 2,600 Cs 0 2,600 2,600 a. If the opportunity cost of capital is 10%, which project(s) have a positive NPV? b. Calculate the payback period for each project. c. Which project(s) would a firm using the payback rule accept if the cutoff period is three years? d. Calculate the discounted payback period for each project e. Which project(s) would a firm using the discounted payback rule accept if the cutoff period is three years

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