1.

Compute the payback statistic for Project B if the appropriate cost of capital is 12 percent and the maximum allowable payback period is three years. (Round your answer to 2 decimal places. If the project never pays back, then enter a "0" (zero).)

Project B
Time:	0	1	2	3	4	5
Cash flow	$11,600	$3,410	$4,300	$1,640	$0	$1,120

2.

Compute the payback statistic for Project A if the appropriate cost of capital is 9 percent and the maximum allowable payback period is four years. (Round your answer to 2 decimal places.)

Project A
Time:	0	1	2	3	4	5
Cash flow	$1,200	$430	$540	$560	$340	$140

3.

Compute the IRR static for Project E. The appropriate cost of capital is 7 percent. (Do not round intermediate calculations. Round your final answer to 2 decimal places.)

Project E
Time:	0	1	2	3	4	5
Cash flow	$2,000	$750	$780	$720	$500	$300

4.

Suppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of this risk class is 7 percent, and that the maximum allowable payback and discounted payback statistics for the project are 3.5 and 4.5 years, respectively.

Time:	0	1	2	3	4	5	6
Cash flow	$4,800	$1,210	$2,410	$1,610	$1,530	$1,410	$1,210

Use the payback decision rule to evaluate this project.

5.

Suppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of this risk class is 8 percent, and that the maximum allowable payback and discounted payback statistics for the project are 3.5 and 4.5 years, respectively.

Time:	0	1	2	3	4	5	6
Cash flow	$7,700	$1,110	$2,310	$1,510	$1,510	$1,310	$1,110

Use the IRR decision rule to evaluate this project