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Version:0.9 StartHTML:0000000105 EndHTML:0000001275 StartFragment:0000000141 EndFragment:0000001235 MoD Furniture Limited is evaluating whether to invest in the following project. The cost of the project is $200,000. The
Version:0.9 StartHTML:0000000105 EndHTML:0000001275 StartFragment:0000000141 EndFragment:0000001235
MoD Furniture Limited is evaluating whether to invest in the following project. The cost of the project is $200,000. The project cash inflows would be $60,000, $100,000, $100,000, and $60,000 at the end of each year for the next 4 years. Calculate the payback period for the investment.
Given the firms maximum payback period is 3 years, should the firm go ahead with the project? Show all necessary workings.
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