Project P has a cost of $1,000 and cash flows of $300 per year for 3 years plus

another $1,000 in Year 4. The projects cost of capital is 15%.

a. What are Ps regular and discounted paybacks? (4 marks)

b. If the company requires a payback of 3 years or less, would the project be accepted?

(2 marks) Would this be a good accept/reject decision, considering NPV (4 marks).