Finance

Assume a \$4,000 investment and the following cash flows for two alternatives.
Year Investment X Investment Y
1 \$1,000 \$1,300
2 800 2,800
3 700 100
4 1,900
5 2,000

a. Under the payback method, which investment should be chosen? (Show your work/analysis/calculations for each investment).

b. Why do other methods allow for a better analysis?

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2. 👎
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1. How much will Pauline pay in interest if she takes out a simple interest loan with a principal of \$3,900 at 7.2% for three years?

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2. Calculate the return on investment in dollars and as a percentage for an investment that you purchase for \$500 and sell for \$600.

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