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Shields Company has gathered the following data on a proposed investment project: Investment Required in Equipment $400,000 Annual Cash Inflows $ 80,000 Salvage Value $-0-
Shields Company has gathered the following data on a proposed investment project: Investment Required in Equipment $400,000 Annual Cash Inflows $ 80,000 Salvage Value $-0- Life of the Investment 10 years Discount Rate 10% (Ignore income taxes in this problem.) A. What is the payback period for the investment? B. What is the simple rate of return on the investment? C. What is the net present value on this investment? D. What is the internal rate of return on the investment?
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