The Blue Goose Is Considering a Project with an Initial

Multiple Choice

The Blue Goose is considering a project with an initial cost of $42,700. The project will produce cash inflows of $8,000 a year for the first two years and $12,000 a year for the following three years. What is the payback period?

A) 2.87 years
B) 3.23 years
C) 3.41 years
D) 3.79 years
E) 4.23 years