Question: Milano Co. is considering two mutually exclusive projects with the same cost of capital of 13%. The estimated net cash flows are as follows: Year

Milano Co. is considering two mutually exclusive projects with the same

Milano Co. is considering two mutually exclusive projects with the same cost of capital of 13%. The estimated net cash flows are as follows: Year 0 1 Project X -$490 $280 $250 $110 Project Y -$540 $310 $650 -$320 2 3 c) Calculate the payback period (PP) for each project. Give your answer in years, to 2 decimal places. Then state which project is preferable under the PP criterion. (2 marks)

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