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A four-year financial project has a net cash flows of R20,000, R25,000, R30,000 and R50,000 in the next four years. It will cost R75,000
A four-year financial project has a net cash flows of R20,000, R25,000, R30,000 and R50,000 in the next four years. It will cost R75,000 to implement the project. If the required rate of return is 20% with no inflation. Find (a) The pay-back period (b) The NPV, and (c) The PI. (d) What would happen to NPV and PI if the inflation rate was expected to be 4% in each of the next years?
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Answer To calculate the payback period we need to determine how long it takes for the cumulative cash flows to equal or exceed the initial investment ...
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Accounting
Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren
23rd Edition
978-0324662962
