Payback period. Given the cash flow of two projects-A and B--in the following table, E, and using the payback period decision model, which project(s) do you accept and which project(s) do you reject if you have a 3-year cutoff period for recapturing the initial cash outflow? For payback period calculations, assume that the cash flow is equally distributed over the year. What is the payback period for project A? 2.5 years (Round to one decimal place.) Nith a 3-year cutoff period for recapturing the initial cash outflow, project A would be accepted . (Select from the drop-down menu.) What is the payback period for project B? 4.0 years (Round to one decimal place.) Nith a 3-year cutoff period for recapturing the initial cash outflow, project B would be rejected. (Select from the drop-down menu.) 1 Data Table (Click on the following icon O in order to copy its contents into a spreadsheet.) Cash Flow B Cost $12,000 $110,000 Cash flow year 1 $4,800 $44,000 Cash flow year 2 Cash flow year 3 Cash flow year 4 $4,800 $33,000 $4,800 $22,000 tuestion is complete. Tap $4,800 $11,000 $0 Cash flow year 5 $4,800 Il parts showing Similar Question Cash flow year 9. $4,800 $0
Payback period. Given the cash flow of two projects-A and B--in the following table, E, and using the payback period decision model, which project(s) do you accept and which project(s) do you reject if you have a 3-year cutoff period for recapturing the initial cash outflow? For payback period calculations, assume that the cash flow is equally distributed over the year. What is the payback period for project A? 2.5 years (Round to one decimal place.) Nith a 3-year cutoff period for recapturing the initial cash outflow, project A would be accepted . (Select from the drop-down menu.) What is the payback period for project B? 4.0 years (Round to one decimal place.) Nith a 3-year cutoff period for recapturing the initial cash outflow, project B would be rejected. (Select from the drop-down menu.) 1 Data Table (Click on the following icon O in order to copy its contents into a spreadsheet.) Cash Flow B Cost $12,000 $110,000 Cash flow year 1 $4,800 $44,000 Cash flow year 2 Cash flow year 3 Cash flow year 4 $4,800 $33,000 $4,800 $22,000 tuestion is complete. Tap $4,800 $11,000 $0 Cash flow year 5 $4,800 Il parts showing Similar Question Cash flow year 9. $4,800 $0
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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Transcribed Image Text:Payback period. Given the cash flow of two projects-A and B-in the following table, , and using the payback period decision model, which project(s) do you
accept and which project(s) do you reject if you have a 3-year cutoff period for recapturing the initial cash outflow? For payback period calculations, assume that the
cash flow is equally distributed over the year.
What is the payback period for project A?
2.5 years (Round to one decimal place.)
With a 3-year cutoff period for recapturing the initial cash outflow, project A would be accepted
(Select from the drop-down menu.)
What is the payback period for project B?
4.0 years (Round to one decimal place.)
With a 3-year cutoff period for recapturing the initial cash outflow, project B would be rejected
(Select from the drop-down menu.)
Data Table
(Click on the following icon P in order to copy its contents into a spreadsheet.)
Cash Flow
Cost
$12,000
$110,000
Cash flow year 1
Cash flow year 2
$4,800
$44,000
$4,800
$33,000
Cash flow year 3
$4,800
$22,000
Question is complete. Tap
Cash flow year 4
$4,800
$11.000
Cash flow year 5
Cash flow year 6
$4,800
$0
All parts showing
$4,800
$0
Similar Question
Transcribed Image Text:Payback period. Given the cash flow of two projects-A and B-in the following table, , and using the payback period decision model, which project(s) do you
accept and which project(s) do you reject if you have a 3-year cutoff period for recapturing the initial cash outflow? For payback period calculations, assume that the
cash flow is equally distributed over the year.
What is the payback period for project A?
years (Round to one decimal place.)
Data Table
(Click on the following icon e in order to copy its contents into a spreadsheet.)
Cash Flow
A
Cost
$8,000
$90,000
Cash flow year 1
$4,000
$9,000
Cash flow year 2
$4,000
$18,000
Cash flow year 3
Cash flow year 4
$4,000
$27,000
$4,000
$36,000
Cash flow year 5
Cash flow year 6
$4,000
$0
$4,000
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