kris chapter 13 Help Save &Exit; Submit The management of Unter Corporation, an

Question

kris chapter 13 Help Save &Exit; Submit The management of Unter Corporation, an architectural design firm, is considering an investment with the following cash flows 15,000,90 s 8,000 $2,000 $4.000 5,000 $4,000 3,000 $2,000 1 Determine the payback period of the investment 2. Would the payback perlod be affected if the cash inflow in the last year were several times as large? Complete this question by entering your answers in the tabs below. Requireg Required 2 Determine the payback period of the investment of s Next MacBook Air

Explanation / Answer

1) Calculate payback period :

Payback period = 6 years +2500/5000 = 6.5 years

b) No effect

Year Cash flow Cumlative cash flow 1 1000 1000 2 2000 3000 3 2500 5500 4 4000 9500 5 5000 14500 6 6000 20500 7 5000 25500

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