In: Finance
Fernando Designs is considering a project that has the following cash flow and WACC data. What is the project's discounted payback? WACC: 10.00% Year 0 1 2 3 Cash flows -$650 $500 $500 $500
Discounted PBP | ||||
Time | Amount | PVf at 10% | PV | Cumulative |
- | (650.00) | 1.0000 | (650.00) | (650.00) |
1.00 | 500.00 | 0.9091 | 454.55 | (195.45) |
2.00 | 500.00 | 0.8264 | 413.22 | 217.77 |
3.00 | 500.00 | 0.7513 | 375.66 | 593.43 |
PBP = 1 + 195.45/413.22 | ||||
PBP = 1 + .47 Years | ||||
PBP = 1.47 Years |