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Polk Products is considering an investment project with the following cash flows: Year Cash Flow 0...

Polk Products is considering an investment project with the following cash flows: Year Cash Flow 0 -$100,000 1. 20,000 2. 90,000 3. 30,000 4. 60,000 The company has a 10 percent cost of capital. What is the project's discounted payback?

1.86 years

1.67 years

2.67 years

2.49 years

2.33 years

Solutions

Expert Solution

Solution :

The project's Discounted Payback period = 2.33 years

Thus the solution is Option 5 = 2.33 years

Please find the attached screenshot of the excel sheet containing the detailed calculation of the above solution.

jeff jeffy answered 1 year ago
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