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%?