9. Long-term investment decision, payback method Personal Finance Problem Bill Williams has the opportunity to invest in project A that costs $9,300 today and promises to pay $2,100, $2,600, $2,600, $2,100 and $1,700 over the next 5 years. Or, Bill can invest $9,300 in project B that promises to pay $1,500, $1,500, $1,500, $3,400 and $3,900 over the next ble 5 years. (Hint: For mixed stream cash inflows, calculate cumulative cash inflows on a year-to-year basis until the initial investment is recovered.) a. How long will it take for Bill to recoup his initial investment in project A? b. How long will it take for Bill to recoup his initial investment in project B? illia c. Using the payback period, which project should Bill choose? 31 d. Do you see any problems with his choice? a. For Bill to recoup his initial investment in project A, it will take years. (Round to two decimal places.) b. For Bill to recoup his initial investment in project B, it will take years. (Round to two decimal places.) c. Using the payback period, which project should Bill choose? (Select the best answer below.) VOC O Project A would be preferred over project B because its payback period is shorter. O Project 8 would be preferred over project A because its payback period is longer. d. Do you see any problems with his choice? (Select the best answer below.) O A One weakness of the payback method is that it takes into account the expected future cash flows as in the case of project B B. One strength of the payback method is that it disregards expected future cash flows as in the case of project B. C. One weakness of the payback method is that it disregards expected future cash flows as in the case of project B. OD. One strength of the payback method is that it disregards expected future cash flows as in the case of project A