Here are the expected cash flows for three projects:

	Cash Flows (dollars)
Project	Year:	0			1			2			3			4
A			5,600		+	1,150		+	1,150		+	3,300			0
B			1,600			0		+	1,600		+	2,300		+	3,300
C			5,600		+	1,150		+	1,150		+	3,300		+	5,300

a.	What is the payback period on each of the projects?

Project	Payback period
A	_____ years
B	_____ years
C	_____ years

b.

If you use a cutoff period of 2 years, which projects would you accept?

	Project A
	Project B
	Project C
	Project A and Project B
	Project B and Project C
	Project A and Project C
	Projects A, B, and C
	None

c.

If you use a cutoff period of 3 years, which projects would you accept?

Project A

Project B

Project C

Project A and Project B

Project B and Project C

Project A and Project C

Projects A, B, and C

None

d1-1.

If the opportunity cost of capital is 9%, calculate the NPV for projects A, B, and C.(Negative amounts should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to 2 decimal places.)

Project	NPV
A	$_____
B	$_____
C	$_____

d2-2.

Which projects have positive NPVs?

Project A

Project B

Project C

Project A and Project B

Project B and Project C

Project A and Project C

Projects A, B, and C

None

e.

"Payback gives too much weight to cash flows that occur after the cutoff date." True or false?

	True
	False