2 A project costing 20,000 offers an annual cash flow of 5,000 over its life. (a) Calculate...
Question:
2 A project costing £20,000 offers an annual cash flow of £5,000 over its life.
(a) Calculate the internal rate of return using the payback reciprocal assuming an infinite life.
(b) Use tables to test your answer assuming the project life is (i) 20 years, (ii) eight years.
(c) What conclusions can be drawn as to the suitability of the payback reciprocal in measuring investment profitability?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answered By
Rustia Melrod
I am a retired teacher with 6 years of experience teaching various science subjects to high school students and undergraduate students. This background enables me to be able to help tutor students who are struggling with the science of business component of their education. Teaching difficult subjects has definitely taught me patience. There is no greater joy for me than to patiently guide a student to the correct answer. When a student has that "aha!" moment, all my efforts are worth it.
The Common Core standards are a useful yardstick for measuring how well students are doing. My students consistently met or exceeded the Common Core standards for science. I believe in working with each student's individual learning styles to help them understand the material. If students were struggling with a concept, I would figure out a different way to teach or apply that concept. I was voted Teacher of the Year six times in my career. I also won an award for Innovative Teaching Style at the 2011 National Teaching Conference.
4+ Reviews
10+ Question Solved
Related Book For 
Corporate Finance And Investment Decisions And Strategies
ISBN: 9780273695615
5th Edition
Authors: Richard Pike, Bill Neale
Question Posted:
