The management of Kawneer North America is considering investing in a new facility and the following cash flows are expected to result from the investment:

Year	Cash Outflow	Cash Inflow
1	$1,900,000	$95,000
2	550,000	200,000
3		365,000
4		485,000
5		510,000
6		605,000
7		595,000
8		295,000
9		250,000
10		245,000

A. What is the payback period of this uneven cash flow? Round your answer to 2 decimal places.

fill in the blank 1 years

B. Does your answer change if year 10's cash inflow changes to $500,000?

The answer for part A

will changewill not change

if the cash inflow in year 10 changes to $500,000.

1. eBook

   Assume a company is going to make an investment of $465,000 in a machine and the following are the cash flows that two different products would bring in years one through four.

   Option A, Product A	Option B, Product B
   $190,000	$150,000
   195,000	185,000
   65,000	65,000
   25,000	75,000

   A. Calculate the payback period of each product. Round your answers to 2 decimal places.

   Option A, Product A	fill in the blank 1 years
   Option B, Product B	fill in the blank 2 years

   B. Which of the two options would you choose based on the payback method?

   Option A, Product AOption B, Product B