Transcribed Image Text
A project that costs $2,800 to install will provide annual cashflows of $630 for the next 6 years. The firm accepts projects withpayback periods of less than 4 years.a-1.What is this project's payback period? (Round youranswer to 3 decimal places.) Payback periodyearsa-2.Will the project be accepted?NoYesb-1.What is project NPV if the discount rate is 2%? (Do notround intermediate calculations. Round your answer to 2 decimalplaces.) NPV$ b-2.Should this project be pursued?YesNob-3.What is project NPV if the discount rate is 12%?(Negative amount should be indicated by a minus sign. Donot round intermediate calculations. Round your answer to 2 decimalplaces.) NPV$ b-4.Should this project be pursued?YesNob-5.Will the firm’s decision change as the discount ratechanges?