1) the payback period of the proposed investment is .... Years ( round two decim

Question

1) the payback period of the proposed investment is .... Years ( round two decimal places) 2) the NPV of the proposed investment is ... Round to nearest cent 3) the IRR of the proposed investment is ...% round 2 decimal places 4) should fisher international accept or reject the proposed investment? This Test: 12 pts easibility of investing $88,000 in a piece of equipment that has a 5-year life. The firm has estimated the cash apital. able on the icon located on the top-right corner of the data table below in order to copy its nts into a spreadsheet.) Year ( Cash inflows (CF) $35,000 $25,000 $20,000 $20,000 S35,000 2 Print Done Previous Question Next Question

Explanation / Answer

Calculation of Payback Period:

Initial Investment = $88,000

Payback Period = 3 + 8,000 / 20,000 = 3.40 Years

Calculation of NPV and IRR is not possible because Discount Rate is missing.

Year Inflow Cumulative Inflow 0 (88,000) (88,000) 1 35,000 (53,000) 2 25,000 (28,000) 3 20,000 (8,000) 4 20,000 12,000

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