It Will Cost $9,600 to Acquire an Ice Cream Cart

Multiple Choice

It will cost $9,600 to acquire an ice cream cart that is expected to produce cash inflows of $3,600 a year for three years. After the three years, the cart is expected to be worthless. What is the payback period?

A) 1.82 years
B) 2.67 years
C) 2.82 years
D) 1.67 years
E) 1.79 years