An investment project provides cash inflows of $585 per year for eight years. Wh

Question

An investment project provides cash inflows of $585 per year for eight years.

What is the project payback period if the initial cost is $1,650? (Enter 0 if the project never pays back. Do not round intermediate calculations and round your answer to 2 decimal places. (e.g., 32.16))

What is the project payback period if the initial cost is $3,250? (Enter 0 if the project never pays back. Do not round intermediate calculations and round your answer to 2 decimal places. (e.g., 32.16))

What is the project payback period if the initial cost is $4,700? (Enter 0 if the project never pays back. Do not round intermediate calculations and round your answer to 2 decimal places. (e.g., 32.16))

An investment project provides cash inflows of $585 per year for eight years.

Explanation / Answer

An investment project provides cash inflows of $585 per year for eight years.

What is the project payback period if the initial cost is $1,650? (Enter 0 if the project never pays back. Do not round intermediate calculations and round your answer to 2 decimal places. (e.g., 32.16))

Payback period = Initial cost/ Annual Cash inflow

Payback period = 1650/585

Payback period = 2.82 Years

Answer

  Payback period 2.82 years

What is the project payback period if the initial cost is $3,250? (Enter 0 if the project never pays back. Do not round intermediate calculations and round your answer to 2 decimal places. (e.g., 32.16))

Payback period = Initial cost/ Annual Cash inflow

Payback period = 3250/585

Payback period = 5.56 Years

Answer

  Payback period 5.56 years

What is the project payback period if the initial cost is $4,700? (Enter 0 if the project never pays back. Do not round intermediate calculations and round your answer to 2 decimal places. (e.g., 32.16))

Payback period = Initial cost/ Annual Cash inflow

Payback period = 7400/585

Payback period = 12.65 Years

Since Annual cash Flow is till 8 year Therefore it will never payback

Answer

  Payback period 0 years

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