In: Finance
(Discounted payback period) Gio's Restaurants is considering a project with the following expected cash flows: Year Project Cash Flow (millions) 0 $(240) 1 100 2 75 3 100 4 110 If the project's appropriate discount rate is 11 percent, what is the project's discounted payback period? The project's discounted payback period is nothing years. (Round to two decimal places.)
Discounted PBP | ||||
Time | Amount | Pvfat 11% | PV | Cumulative |
- | (240.00) | 1.0000 | (240.00) | (240.00) |
1.00 | 100.00 | 0.9009 | 90.09 | (149.91) |
2.00 | 75.00 | 0.8116 | 60.87 | (89.04) |
3.00 | 100.00 | 0.7312 | 73.12 | (15.92) |
4.00 | 110.00 | 0.6587 | 72.46 | 56.54 |
Discounted Payback = 3 + 15.92/72.46 | ||||
Discounted Payback = 3 + .22 | ||||
Discounted Payback = 3.22 Years | ||||