Question: The Troomp project has all positive cash flows for all 7 years of its life. Its discounted pay-back period is 5.5 years, and undiscounted pay-back

The Troomp project has all positive cash flows for all 7 years of its life. Its discounted pay-back period is 5.5 years, and undiscounted pay-back period is 5 years.

If the payment on the seventh year (the last year) of the project increases from $100 to $200,then

I. The discounted pay back period will be shorter than 5.5 years.

II. The ordinary (undiscounted) pay-back period will be longer than 5 years

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