An investment project provides cash inflows of $645 per year for eight years. Wh

Question

An investment project provides cash inflows of $645 per year for eight years.

What is the project payback period if the initial cost is $1,800? (Enter 0 if the project never pays back. Round your answer to 2 decimal places, e.g., 32.16.)

What is the project payback period if the initial cost is $3,500? (Enter 0 if the project never pays back. Round your answer to 2 decimal places, e.g., 32.16.)

What is the project payback period if the initial cost is $5,300? (Enter 0 if the project never pays back. Round your answer to 2 decimal places, e.g., 32.16.)

What is the project payback period if the initial cost is $1,800? (Enter 0 if the project never pays back. Round your answer to 2 decimal places, e.g., 32.16.)

Explanation / Answer

payback period=initial investment/annual cash flows

1.payback period=(1800/645)=2.79 years

2.payback period=(3500/645)=5.43 years

3.payback period=(5300/645)=0

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