Calculating Payback Old Country, Inc., imposes a payback cutoff of three years for its international investment projects.

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Calculating Payback Old Country, Inc., imposes a payback cutoff of three years for its international investment projects. If the company has the following two projects available, should it accept either of them?

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Fundamentals of Corporate Finance

ISBN: 978-0077861629

8th Edition

Authors: Stephen A. Ross, Randolph W. Westerfield, Bradford D.Jordan

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Question Posted: Apr 28, 2011 03:11 AM

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Calculating Payback Old Country, Inc., imposes a payback cutoff of three years for its international investment projects.

Question:

Year Cash Flow (A) Cash Flow (B) -S 50,000 -S 70,000 0. 35,000 15,000 21,000 22,000 10,000 31,000 4. 5,000 240,000 1. 2. 3.

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Project A has cash flows of 35000 in Year 1 so the c...View the full answer

Fundamentals of Corporate Finance

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