Problem:
An investment project costs $10,000 and has annual cash flows of $2,990 for six years.
Required:
Question 1: What is the discounted payback period if the discount rate is zero percent?
Question 2: What is the discounted payback period if the discount rate is 5 percent?
Question 3: What is the discounted payback period if the discount rate is 20 percent?
Note: Provide support for rationale.