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The Zingstad Corporation is considering an investment with the following data (Ignore income taxes.): Year 1 Year 2 Year 3 Year 4 Year 5 Investment

The Zingstad Corporation is considering an investment with the following data (Ignore income taxes.):

Year 1 Year 2 Year 3 Year 4 Year 5
Investment $ 32,000 $ 12,000
Cash inflow $ 8,000 $ 8,000 $ 20,000 $ 16,000 $ 16,000

Cash inflows occur evenly throughout the year. The payback period for this investment is:

Multiple Choice

a) 3.5 years

b) 4.0 years

c) 3.0 years

d) 4.5 years

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