Question: 7.1 Mpho is considering adding toys to his general store. He estimates that the cost of inventory willbe R4 200. The remodelling expenses and shelving

7.1 Mpho is considering adding toys to his general store. He

7.1 Mpho is considering adding toys to his general store. He estimates that the cost of inventory willbe R4 200. The remodelling expenses and shelving costs are estimated at R1 500. Toy sales are expected to produce net cash inflows of R1 200, R1 500, R1 600, and R1 750 over the next four years, respectively. Should Jack add toys to his store if he assigns a three-year payback period to this project? (3)

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