You are considering three independent projects, project A, project B, and project C. Given the following cash- flow information, calculate the payback period for each.

If you require a 3- year payback before an investment can be accepted, which project(s) would be accepted?

Transcribed Image Text:

PROJECTA PROJECT B PROJECT C Initial outlay Inflow year1 Inflow year 2 Inflow year 3 Inflow year 4 Inflow year 5 -$1,000 600 300 200 100 500 $10,000 5,000 3,000 3,000 3,000 3,000 $5,000 1,000 1,000 2,000 2,000 2,000