A firm wants to get their money back ASAP on a project.
a) If the company's cost of capital is 10%, what is the discounted payback period on the following project:
Estimated cash flows:
Time 0 (Today) -$24,000
Year 1 $14,000
Year 2 $13,000
Year 3 $15,000
b) If the maximum allowable discounted payback is 1.5 years, should the company accept the project?