Problem:

An investment project has annual cash inflows of $3,200, $4,100, $5,300, and $4,500, and a discount rate of 14 percent.

Required:

Question 1: What is the discounted payback period for these cash flows if the initial cost is $5,900?

Question 2: What is the discounted payback period for these cash flows if the initial cost is $8,000?

Question 3: What is the discounted payback period for these cash flows if the initial cost is $11,000?

Note: Provide support for your underlying principle.