Problem 5-1 Payback Consider the following information: Project A B -5,800 -1,100 -3,500 Cash Flows ($) Ci C2 C3 1,800 1,800 2,200 0 700 2,800 700 2,400 1,300 C4 0 3,800 800 a. What is the payback period on each of the above projects? (Round your answers to 2 decimal places.) Project A Payback Period year(s) year(s) year(s) B b. Given that you wish to use the payback rule with a cutoff period of two years, which projects would you accept? Project A and Project B O Project A O Project C O Project A and Project C O Project B and Project C O None O Project A, Project B, and Project C O Project B c. If you use a cutoff period of three years, which projects would you accept? O Project C O Project B O Project A O Project B and Project C O Project A and Project C O Project A and Project B O Project A, Project B, and Project C d. If the opportunity cost of capital is 10%, which projects have positive NPVs? O Project C O Project B O Project B and Project C O Project A and Project B O Project A, Project B, and Project C O Project A and Project C O Project A e. "If a firm uses a single cutoff period for all projects, it is likely to accept too many shortlived projects." True or false? O True O False f-1. If the firm uses the discounted-payback rule, will it accept any negative-NPV projects? O Yes O No f-2. Will it turn down any positive-NPV projects? Yes