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The Sea Corporation has been presented with an investment opportunity which will yield cash flows of $40,000 per year in Years 1 through 4, $5,000
The Sea Corporation has been presented with an investment opportunity which will yield cash flows of $40,000 per year in Years 1 through 4, $5,000 per year in Years 5 through 9, and $60,000 in Year 10. This investment will cost the firm $173,000 today, and the firm's cost of capital is 10 percent. What is the payback period for this investment?
Question 10 options:
between 3 and 4 years.
between 4 and 5 years
between 5 and 6 years
between 6 and 7 years
None of the above are correct.
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