The Short-Line Railroad is considering a $140,000 investment in either of two companies. The cash flows are

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The Short-Line Railroad is considering a $140,000 investment in either of two companies. The cash flows are as follows:

a. Using the payback method, what will the decision be?
b. Explain why the answer in part a can bemisleading.

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Foundations of Financial Management

ISBN: 978-1259194078

15th edition

Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen

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Question Posted: Oct 14, 2014 06:54 AM

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The Short-Line Railroad is considering a $140,000 investment in either of two companies. The cash flows are

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Year Electric Co. $85,000 25,000 30,000 10,000 Water Works $30.000 25,000 85,000 10,000 4-10

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ShortLine Railroad a Payback for Electric Co Payback for Water Works 140000 85...View the full answer

Foundations of Financial Management

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