Consider a project with an initial outlay of $1,000 and yearly cash flows as follows: -200, -100, 300, 300, 300, 100, 100, 200, 700, 400, and 100. Calculate the classical payback period assuming 10% cost of funds.

A. 8

B. 8.5

C. 9

D. 9.75

If the RTY Corporation follows CAPM and has a beta of 2.0, and the market and risk-free rate of return are 14 and 8 percent, respectively. Obtain the cost of equity capital for the RTY Corporation

A. 6%

B. 14%

C. 20%

D. 22%