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Hi all,

Can someone pleaseanswer this CASH FLOW question. Thank you.

Consider the followinginformation:

	Cash Flows ($)
Project	C0	C1	C2	C3	C4
A	–5,500	1,500	1,500	3,500	0
B	–500	0	400	2,500	3,500
C	3,800	500	3,100	1,000	500

a.What is the payback period on each of the above projects?(Round your answers to 2 decimal places.)

Project	PaybackPeriod
A	year(s)
B	year(s)
C	year(s)

b.Given that you wish to use the payback rule with a cutoff period oftwo years, which projects would you accept?

	ProjectB
	None
	ProjectC
	ProjectA, Project B, and Project C
	ProjectA and Project C
	ProjectA and Project B
	ProjectB and Project C
	ProjectA

c. Ifyou use a cutoff period of three years, which projects would youaccept?

	ProjectB
	ProjectA and Project C
	ProjectA, Project B, and Project C
	ProjectC
	ProjectA and Project B
	ProjectA
	ProjectB and Project C

d. Ifthe opportunity cost of capital is 10%, which projects havepositive NPVs?

	ProjectA, Project B, and Project C
	ProjectA
	ProjectA and Project C
	ProjectB
	ProjectA and Project B
	ProjectC
	ProjectB and Project C

e.“If a firm uses a single cutoff period for all projects, it islikely to accept too many short-lived projects.” True or false?

	True
	False

f-1.If the firm uses the discounted-payback rule, will it accept anynegative-NPV projects?

	Yes
	No

f-2.Will it turn down positive-NPV projects?

	Yes
	No