The management of Zesty Corporation is considering the purchase of a new machine costing $400,000. The company's desired rate of return is 10%. Use the following data in determining the acceptability in this situation:

Year

Income fromOperations

Net Cash

Flow

1

$100,000

$180,000

2

40,000

120,000

3

20,000

100,000

4

10,000

90,000

5

10,000

90,000

1. The cash payback period for this investment is__________________________________

1. The average rate of return for this investment is_________________________________