Question
Your friend needs help with their homework. They need to compute the payback period on a proposed capital budgeting project - - a new wind
Your friend needs help with their homework. They need to compute the payback period on a proposed capital budgeting project - - a new wind turbine. The expected cash flows appear below. Your friend is not sure whether they must use the required rate of return of 15.5% in computing the answer. What is the payback period? Your friend in counting on you. (Answer in years, rounding to 2 decimals) Year 0 cash flow = -128,000 Year 1 cash flow = 32,000 Year 2 cash flow = 32,000 Year 3 cash flow = 32,000 Year 4 cash flow = 32,000 Year 5 cash flow = 32,000 Year 6 cash flow = 32,000 Year 7 cash flow = 32,000 Year 8 cash flow = 32,000
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