Homer is considering a project which will produce cash inflows of $950 a year for 4 years. The project has a 9% required rate of return and an initial cost of $2,900. What is the discounted payback period? a. 3.05 years b. 3.74 years c. 3.81 years d. 3.92 years e. Never

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter11: Capital Budgeting Decisions
Section: Chapter Questions
Problem 19EA: Redbird Company is considering a project with an initial investment of $265,000 in new equipment...
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What is the discounted payback period?

Homer is considering a project which will produce
cash inflows of $950 a year for 4 years. The project
has a 9% required rate of return and an initial cost
of $2,900. What is the discounted payback period?
a. 3.05 years
b. 3.74 years
c. 3.81 years
d. 3.92 years
e. Never
Transcribed Image Text:Homer is considering a project which will produce cash inflows of $950 a year for 4 years. The project has a 9% required rate of return and an initial cost of $2,900. What is the discounted payback period? a. 3.05 years b. 3.74 years c. 3.81 years d. 3.92 years e. Never
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