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An investment costs $400,000 and generates $50,000 per year in net cash inflows. The cost of capital is 12 percent. What is the payback period?

An investment costs $400,000 and generates $50,000 per year in net cash inflows. The cost of capital is 12 percent. What is the payback period?

a. 28.4 years b. 6 years c. 8 years d. 5.9 years

Please show the formula you used to calculate it. Thanks

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