Find the discounted Payback period for the following project. The discount rate

Question

Find the discounted Payback period for the following project. The discount rate is 9% Project X Initial outlay $                   8,644.00 Year 1 $                   3,099.00 Year2 $                   3,942.00 Year 3 $                   5,447.00 Year 4 $                   7,880.00 Round the answer two decimal places Find the discounted Payback period for the following project. The discount rate is 9% Project X Initial outlay $                   8,644.00 Year 1 $                   3,099.00 Year2 $                   3,942.00 Year 3 $                   5,447.00 Year 4 $                   7,880.00 Round the answer two decimal places

Explanation / Answer

Discounted Payback period = 2 + 2482.98/4206.08

Discounted Payback period = 2.59 Years

Working

Project X Cash flow PV Factor @ 9% Present Value Cumulative of PV of Cash flow [a] [b] [c = a*b] [ d = previous d + c] Initial outlay -8644 1.00000 -8644 -8644 Year 1 3099 0.91743             2,843.12 -5800.88 Year2 3942 0.84168             3,317.90 -2482.98 Year 3 5447 0.77218             4,206.08                                               1,723.11 Year 4 7880 0.70843             5,582.39                                               7,305.50

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