Suppose You are given the following cash flows:

find the payback period,

the IRR,

and the required rate of return in 8%

1. Suppose you are given the following cash flows: Initial Investment -120 Year 1 Cash Flow +70 Year 2 Cash Flow +60 Year 3 Cash Flow +40 a. (7 points) What is the payback period on the investment? +20 70 60 40 1 3 tr 3.02 & 3 years b. (7 points) What is the IRR for the investment? 70 60 Irr= -120+ - + 40 0:-120+(6) Ittle = 70 + 120 11:19 r/= 70tiho (141) (1,4% (1.41)3 - 0.47 70 +122 720 = - 25000 -4.5831 C. (7 points) If the required rate of return is 8%, what is the NPV of the investment? NPV = -120 () 0-120