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Q4. (25 marks) Alina Smith is considering an investment which will cost her $120,000. The investment produces no cash flows for the first year. In

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Q4. (25 marks) Alina Smith is considering an investment which will cost her $120,000. The investment produces no cash flows for the first year. In the second year the cash inflow is $35,000. This inflow will increase to $55,000 and then $75,000 for the following two years before ceasing permanently. Alina requires a 10 % rate of return and has a required discounted payback period of three years. Calculate discounted payback period and comment whether the project should be accepted or not

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