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A power-generating company that has a discount rate of 11% has decided to invest in solar power generation. The initial investment is expected to be
A power-generating company that has a discount rate of 11% has decided to invest in solar power generation. The initial investment is expected to be a large $95 million dollar investment today. Because of the nature of this project, the company expects that the projects cash inflows will begin at the end of year 5 and will last for 6 years. The cashflows are $50 million dollars per year. What is the payback period of this investment?
Select one:
a. 5.5 years
b. 5.9 years
c. 6 years
d. 5 years
e. 6.75 years
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