Question: Consider the following scenario (the given information is the same as in the previous question): Suppose we have a project that requires an initial investment

Consider the following scenario (the given information is the same as in the previous question): Suppose we have a project that requires an initial investment of $1,000. It will provide the cash inflows of $500 in year 1, $300 in year 2, and $100 each year hereafter (starting in year 3). The required rate of return is 10% for this project. Suppose we have a 6-year payback cutoff. Based on the payback period rule, the payback period for this project. Question 36 options:

A)

4; reject

B)

5; reject

C)

5; accept

D)

4; accept

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