Question $3(10$ Marks$)$

Consider two projects whose annual net cash flows are not even. Assume that each project costs

R$200000.$ The net cash flows for each year are as follows:

Year Project M Project O

$120000100000$

$24000080000$

$36000060000$

$48000040000$

$510000020000$

Calculate the Pay Back Period $($PBP$)$ of each project and recommend the project that should be selected based on the

payback method.