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A project has an initial cost of $17,800 and produces cash inflows of $7,200, $8,900, and...

A project has an initial cost of $17,800 and produces cash inflows of $7,200, $8,900, and $7,500 over three years, respectively. What is the discounted payback period if the required rate of return is 16 percent?

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Answer #1

Solution :-

As we see the Cummulative cashflow is not becomes positive during the life of the project

So Discounted Payback Period is more than 3 Years

As the Cummulative Cashflow not becomes positive during the life

So Reject the Project

If there is any doubt please ask in comments

Thank you please rate

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