Question 4

The Zingstad Corporation is considering an investment with the following data (Ignore income taxes.):

Year 1 year 2 year 3 year 4 year 5 Investment $ 32,000 $ 12,000 Cash inflow $ 8,000 $ 8,000 $ 20,000 $ 16,000 $ 16,000

Cash inflows occur evenly throughout the year. The payback period for this investment is:

3.0 years 3.5 years 4.0 years 4.5 years