Suppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of this risk class is 8 percent, and that the maximum allowable payback and discounted payback statistics for the project are 2.5 and 3.5 years, respectively. Time: 0 1 2 3 4 5 6 Cash flow $4,600 $1,120 $2,320 $1,520 $1,520 $1,320 $1,120

Use the payback decision rule to evaluate this project