Larkspur Inc. is contemplating a capital investment of $78000. The cash flows over the project's four years are:
Expected Annual Expected Annual
Year cash inflows cash outflows
1 $38000 $1200
2 2800 20000
3 60000 24000
4 50000 30000
The cash payback period is
a. 3.42 yrs. b. 2.33 years. c. 3.40 years. d. 3.20 years.
