Cepeda Manufacturing Company is considering three new projects, each requiring an equipment investment of $22,000. Each project will last for 3 years and produce the following cash inflows. 
The equipment's salvage value is zero. Cepeda uses straight-line depreciation. Cepeda will not accept any project with a payback period over 2 years. Cepeda's minimum required rate of return is 12%.
Instructions
(a) Compute each project's payback period, indicating the most desirable project and the least desirable project using this method. (Round to two decimals.)
(b) Compute the net present value of each project. Does your evaluation change? (Round to nearest dollar.)
Definitions:
Survival Odds
A statistical estimate of the likelihood of continuing to live or survive, often used in medical contexts.
Social Networking
The use of internet-based platforms and applications to build, engage, and share with a community or network of personal or professional contacts.
Confidentiality
The ethical principle ensuring private information is not disclosed without consent.
Values
The beliefs and principles that influence an individual's choices and behaviors.
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