Question - A project will require an initial investment of $600,000 and is expected to generate the following cash flows:
Year 1 $100,000
Year 2 $250,000
Year 3 $250,000
Year 4 $200,000
Year 5 $100,000
(a) What is the project's payback period?
(b) If the required rate of return is 20% and taxes are ignored, what is the project's net present value?