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The management of Unter Corporation, an architectural design firm, is considering an investment with the following cash flows: Year Investment Cash Inflow 1 $ 15,000

The management of Unter Corporation, an architectural design firm, is considering an investment with the following cash flows:

Year Investment Cash Inflow
1 $ 15,000 $ 1,000
2 $ 8,000 $ 2,000
3 $ 2,500
4 $ 4,000
5 $ 5,000
6 $ 6,000
7 $ 5,000
8 $ 4,000
9 $ 3,000
10 $ 2,000

Required:

1. Determine the payback period of the investment.

2. Would the payback period be affected if the cash inflow in the last year were several times as large?

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