where i% is the MARR, I is the capital investment usually made at the present time (k = 0), and θ′ is the smallest value that satisfies Equation (5-10). Table 5-2 (Columns 4 and 5) also illustrates the determination of θ′ for Example 5-13.Notice that θ′ is the first year in which the cumulatived is counted cash inflows exceed the $25,000 capital investment. Payback periods of three yearsor less are often desired in U.S. industry, so the project in Example 5-13 could be rejected, even though it is profitable. [IRR = 21.58%, PW(20%) = $934.29.] The simple and discounted payback periods are shown graphically in Figure5-9.