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You are considering an investment with the following cash flows.Your required return is 8%, you require a payback of 3 years and adiscounted payback of 4 years. If your objective is to maximizeyour wealth, should you take this investment?Year 0 1 2 3 4 5Cash Flow –$50,000 $20,000 $20,000 $20,000 $20,000 –$50,000Yes, because the payback is 2.5 years.Yes, because the discounted payback is less than 4 years.Yes, because both the payback and the discounted payback areless than 2 years.No, because the NPV is negative.No, because the project cash flows are not conventional.
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