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Use the following table of free cash flows for an investment to answer questions 12-15: 0 2 3 Free Cash Flow -8,000 1,000 5,000 3,000
Use the following table of free cash flows for an investment to answer questions 12-15: 0 2 3 Free Cash Flow -8,000 1,000 5,000 3,000 12. What is the payback period for this project? If the required payback period is 2 years, would you invest in this project based on the payback period? 13. If the discount rate is 10%, what is the discounted payback period for this project? If the required discounted payback period is 2 years, would you invest in this project based on the payback period? 14. What is the internal rate of return on this project? If the discount rate (or WACC) is 10%, would you invest in this project? 15. With a discount rate (or WACC) of 10%, what is the net present value (NPV) of this project and would you accept or reject the project
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