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Faster Manufacturing Company is evaluating a capital project that requires an initial investment of $283,000. Managers estimate that for the next 12 years, the project
Faster Manufacturing Company is evaluating a capital project that requires an initial investment of $283,000. Managers estimate that for the next 12 years, the project will result in a $200,000 increase in annual cash inflows and a $150,000 increase in annual cash outflows. There will be no residual value. What are the payback period and the internal rate of return for this project? A. Payback 5.7 years, IRR 35% B. Payback 5.7 years, IRR 17% C. Payback 5.7 years, IRR 14% D. Payback 1.4 years, IRR 17%
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