In: Finance
| Stenson, Inc., imposes a payback cutoff of three years for its international investment projects. Assume the company has the following two projects available. |
| Year | Cash Flow A | Cash Flow B | ||
| 0 | –$ | 47,000 | –$ | 92,000 |
| 1 | 18,000 | 20,000 | ||
| 2 | 24,200 | 25,000 | ||
| 3 | 20,000 | 34,000 | ||
| 4 | 6,000 | 248,000 | ||
|
What is the payback period for each project (A and B in years)? |