A project has an initial cost of $54,300, expected net cash inflows of $14,000 per year...

A project has an initial cost of $54,300, expected net cash inflows of $14,000 per year for 9 years, and a cost of capital of 13%. What is the project's payback period? Round your answer to two decimal place

Expert Solution

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Calculation of pay back period:
Time	Amount	Cumulative
-	(54,300.00)	(54,300.00)
1.00	14,000.00	(40,300.00)
2.00	14,000.00	(26,300.00)
3.00	14,000.00	(12,300.00)
4.00	14,000.00	1,700.00
5.00	14,000.00	15,700.00
6.00	14,000.00	29,700.00
7.00	14,000.00	43,700.00
8.00	14,000.00	57,700.00
9.00	14,000.00	71,700.00

PBP= 3+12300/14000
PBP= 3.88 years

jeff jeffy answered 7 months ago

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