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The ABC-Logistics company wants to assess its investment opportunity set. Specifically, the following investments (A-Z) with the relevant cash flows are available: Year Investment A
The ABC-Logistics company wants to assess its investment opportunity set. Specifically, the following investments (A-Z) with the relevant cash flows are available: Year Investment A Investment B Investment C Investment D Investment E Investment Z 0 -300.000,00 -380.000,00 -420.000,00 -500.000,00 -360.000,00 -320.000,00 1 60.000,00 90.000,00 100.000,00 160.000,00 50.000,00 80.000,00 2 70.000,00 90.000,00 140.000,00 140.000,00 110.000,00 80.000,00 3 70.000,00 90.000,00 60.000,00 120.000,00 150.000,00 80.000,00 4 70.000,00 90.000,00 60.000,00 100.000,00 170.000,00 80.000,00 5 100.000,00 90.000,00 140.000,00 80.000,00 12.000,00 80.000,00 6 80.000,00 90.000,00 100.000,00 60.000,00 12.000,00 80.000,00 Using this information and taking into consideration that the cost of capital is 7%, you are required to: d. Ranking the investments according to the Simple Payback method. If ABC has as an accepted Payback period of 4 years, which investments would be considered as acceptable? Demonstrate your calculations (7%)
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