Newex, Inc. has a capital investment opportunity with the following cash flows:YearCash Flow(100,000)60,000240,000330,000420,000Which of the following is closest to the project's payback period?2 years2.5 years4 years3.7 years2.8 years

Payback period refers to the length of time period that is needed for an investment to recover its…

Answered: Newex, Inc. has a capital investment…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Newex, Inc. has a capital investment opportunity with the following cash flows: Year Cash Flow (100,000) 60,000 2 40,000 3 30,000 4 20,000 Which of the following is closest to the project's payback period? 2 years 2.5 years 4 years 3.7 years 2.8 years