Hi,

I need help answering this question. I know that the payback period is 2.51 years, but I am unsure of which answer to select. Here is the question:

Elmer Sporting Goods is getting ready to produce a new line of golf clubs by investing $1.65 million. The investment will result in additional cash flows of $525,000, $612,500, and 1,000,000 over the next three years.

A. After 3 years, the initial investment has not been paid back.

B. The project should be accepted if the required payback period is 2.4 years.

C. The project should be rejected if the required payback period is 2.6 years.

D. The project should be accepted if the required payback period is 2.6 years.

Choose the correct answer.