A what is the payback period of the proposed project b what


Company ABC is evaluating a project with the following cash flows:

Year CF

0 -$10,000
1 $2000
2 $3000
3 $4000
4 $5000
5 $6000

Required

a) What is the payback period of the proposed project?

b) What is the NPV of the proposed project if the discount rate is 7%

c) What is the profitability index of the proposed project if the discount rate is 7%?

d) What is the IRR for the proposed project?

Note: Only the equation is required; it is not necessary to solve for IRR.

e) What is the discounted payback period of the proposed project if the discount rate is 7%?

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