1. Microsoft evaluates two projects: Project X ($6,000,000 initial investment, cash inflows $2,000,000 per year), Project Y ($8,000,000 initial investment, cash inflows $2,500,000 per year).
   • Requirements:
     • Calculate the payback period for each project.
     • Determine the project with the shortest payback period.
     • Evaluate the risks associated with the payback period as a capital budgeting criterion.
     • Recommend the project(s) to be accepted based on payback analysis.