The management of Unter Corporation, an architectural design firm, is considering an investment with the following cash flows: Year Investment Cash Inflow 1 $78,000 $5,000 2 $5,000 $10,000 3 $12,000 4 $15,000 5 $18,000 60 $16,000 7 $14,000 00 8 $12,000 9 $11,000 10 $11,000 Required: 1. Determine the payback period of the investment. (Round your answer to 1 decimal place.) 2 Would the payback period be affected if the cash inflow in the last year were several times as large? Yes No
The management of Unter Corporation, an architectural design firm, is considering an investment with the following cash flows: Year Investment Cash Inflow 1 $78,000 $5,000 2 $5,000 $10,000 3 $12,000 4 $15,000 5 $18,000 60 $16,000 7 $14,000 00 8 $12,000 9 $11,000 10 $11,000 Required: 1. Determine the payback period of the investment. (Round your answer to 1 decimal place.) 2 Would the payback period be affected if the cash inflow in the last year were several times as large? Yes No
Chapter11: Capital Budgeting Decisions
Section: Chapter Questions
Problem 6EB: The management of Ryland International Is considering Investing in a new facility and the following...
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Transcribed Image Text:The management of Unter Corporation, an architectural design firm, is considering
an investment with the following cash flows:
Year Investment Cash Inflow
1
$78,000
$5,000
2
$5,000
$10,000
3
$12,000
4
$15,000
5
$18,000
60
$16,000
7
$14,000
00
8
$12,000
9
$11,000
10
$11,000
Required:
1.
Determine the payback period of the investment. (Round your answer
to 1 decimal place.)
2
Would the payback period be affected if the cash inflow in the last year were
several times as large?
Yes
No
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