Question

   Cash Flows (dollars)ProjectYear:0 1 2 3 4 A −6,600 +1,400 +1,400 +3,800  0 B −2,600  0 +2,600 +2,800 +3,800 C −6,600 +1,400 +1,400 +3,800 +5,800  a.What is the payback period on each of the projects?   ProjectPayback periodAyearsByearsCyears b.If you use a cutoff period of 2 years, which projects would you accept?   Project AProject BProject CProject A and Project BProject B and Project CProject A and Project CProjects A, B, and CNone c.If you use a cutoff period of 3 years, which projects would you accept?   Project AProject BProject CProject A and Project BProject B and Project CProject A and Project CProjects A, B, and CNone d-1.If the opportunity cost of capital is 10%, calculate the NPV for projects A, B, and C. (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to 2 decimal places.) ProjectNPVA$B$C$ d-2.Which projects have positive NPVs?   Project AProject BProject CProject A and Project BProject B and Project CProject A and Project CProjects A, B, and CNone e.”Payback gives too much weight to cash flows that occur after the cutoff date.” True or false?   TrueFalse

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