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 $14$ percent, and that the maximum allowable payback and discounted payback statistic for the project are $3$ and $4\mathrm{.}5$ years, respectively.

Time

$0$

$1$

$2$

$3$

$4$

$5$

$6$

Cash Flow

$-1,010$

$110$

$490$

$690$

$690$

$290$

$690$

Use the NPV decision rule to evaluate this project; should it be accepted or rejected?

$$704\mathrm{.}18,$ accept

$$-555\mathrm{.}82,$ reject

$$1,812\mathrm{.}77,$ accept

$$802\mathrm{.}77,$ accept