Leo is considering adding a deli to his general store. The remodelling expenses and shelving costs are estimated at $27,500. Deli sales are expected to produce net cash inflows of $7,300, $8,600, $9,700, and $9,750 for Years 1 to 4, respectively. Leo has a firm 3-year payback requirement. Should he add the deli?

Multiple Choice

No; because the payback period is 2.82 years

No; because the project never pays back

Yes; because the payback period is 3.19 years

Yes; because the payback period is 2.82 years

No; because the payback period is 3.19 years