An investment project has annual cash inflows of $4,300, $4,900, $5,400, and $5,600, and a discount rate
Question:
An investment project has annual cash inflows of $4,300, $4,900, $5,400, and $5,600, and a discount rate of 12 percent. What is the discounted payback period for these cash flows if the initial cost is $6,000? What if the initial cost is $9,000? What if it is $13,000?
Discount RateDepending upon the context, the discount rate has two different definitions and usages. First, the discount rate refers to the interest rate charged to the commercial banks and other financial institutions for the loans they take from the Federal... Payback Period
Payback period method is a traditional method/ approach of capital budgeting. It is the simple and widely used quantitative method of Investment evaluation. Payback period is typically used to evaluate projects or investments before undergoing them,...
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When we use discounted payback we need to find the value of all cash flows today The value today of ...View the full answer
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Related Book For 
Corporate Finance Core Principles and Applications
ISBN: 978-1259289903
5th edition
Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe, Bradford Jordan
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