The cash flows of two alternatives are given below. Determine the no-return payback period for both alternative A and alternative B, respectively. Alternatives А В First cost, $ 20,000 26,000 2,000 (year 1-3) 3,500 (year 4-10) 2,500 (year 1-4) 4,000 (year 5-10) NCF, $ per year S, $ 1,500 2000 Life, year 10 10 6 years for both alternatives 6 years for Alt A and 8 years for Alt B 7 years for Alt A and 8 years for Alt B 8 years for Alt A and 7 years for Alt B
The cash flows of two alternatives are given below. Determine the no-return payback period for both alternative A and alternative B, respectively. Alternatives А В First cost, $ 20,000 26,000 2,000 (year 1-3) 3,500 (year 4-10) 2,500 (year 1-4) 4,000 (year 5-10) NCF, $ per year S, $ 1,500 2000 Life, year 10 10 6 years for both alternatives 6 years for Alt A and 8 years for Alt B 7 years for Alt A and 8 years for Alt B 8 years for Alt A and 7 years for Alt B
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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![The cash flows of two alternatives are given below. Determine the no-return
payback period for both alternative A and alternative B, respectively.
Alternatives
A
В
First cost, $
20,000
26,000
NCF, $ per year
2,000 (year 1-3)
3,500 (year 4-10)
2,500 (year 1-4)
4,000 (year 5-10)
S, $
1,500
2000
Life, year
10
10
6 years for both alternatives
6.
years for Alt A and 8 years for Alt B
7 years for Alt A and 8 years for Alt B
8 years for Alt A and 7 years for Alt B](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F2860be1e-b9fc-4475-9567-768a5e807aa9%2Fac4610b8-83d0-4c0f-a2f2-f44604505e1c%2Fwdnngmb_processed.jpeg&w=3840&q=75)
Transcribed Image Text:The cash flows of two alternatives are given below. Determine the no-return
payback period for both alternative A and alternative B, respectively.
Alternatives
A
В
First cost, $
20,000
26,000
NCF, $ per year
2,000 (year 1-3)
3,500 (year 4-10)
2,500 (year 1-4)
4,000 (year 5-10)
S, $
1,500
2000
Life, year
10
10
6 years for both alternatives
6.
years for Alt A and 8 years for Alt B
7 years for Alt A and 8 years for Alt B
8 years for Alt A and 7 years for Alt B
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