Question

What is the payback period for the following set of cash flows? Year Cash Flow 0 −$ 4,300 1 2,000 2 1,800 3 2,000 4 2,200

Answer #1

Payback Period refers to amount of time taken to recover the
cost of investment.

**Computation of Payback Period**

Year |
Cash Flows |
Cumulative Cash
Flows |

0 | $(4,300) | $(4,300) |

1 | $2,000 | $(2,300) |

2 | $1,800 | $(500) |

3 | $2,000 | $1,500 |

4 | $2,200 | $3,700 |

Payback Period = t + CCF / CF

where,

t = time period when cumulative cash flow was last negative

CCF = Cumulative Cash flow of period t

CF = Cash Flow of the period following the period t

Payback Period = 2 + ( $500 / $2,000 )

= 2 + 0.25

= **2.25 years
Payback Period = 2.25 years**

What is the payback period for the following set of cash
flows?
Year
Cash Flow
0
$ -5,800
1
2,600
2
1,300
3
1,400
4
2,500

What is the payback period for the following set of cash
flows?
Year
Cash flow
0
-$40,000 (it is minus!)
1
$10,000
2
$5,000
3
$20,000
4
$5,000
5
$10,000
A.
2 years
B.
4 years
C.
3 years
D.
1 year
E.
5 years

What is the payback period for the following set of cash
flows?
Year
Cash Flow
0
−$ 2,400
1
1,300
2
1,300
3
1,600
4
2,300
1.85 years
2.15 years
1.87 years
1.80 years
1.94 years

1.
What is the payback period for the following set of cash
flows?
Year
Cash Flow
0
−$ 8,000
1
2,800
2
1,000
3
2,900
4
2,100
Multiple Choice
3.57 years
3.80 years
3.64 years
3.92 years
3.62 years
2.
An investment project provides cash inflows of $650 per year
for 8 years.
a. What is the project payback period if the
initial cost is $3,250?
b. What is the project payback period if...

The payback period for the following set of cash flows is
years.(Round your answer to 2 decimal places. (e.g., 32.16))
Year Cash Flow
0 −$3,600
1 1,000
2 1,800
3 1,300
4 1,200

Q1.) What is the payback period for the following set of cash
flows?
Year Cashflow
0 -$3900
1 1500
2 1400
3 1800
4 1800
Q2.)
An investment project costs $14,400 and has annual cash flows of
$4,200 for six years. What is the discounted payback period if the
discount rate is 5 percent?
Q3.)A project has projected cash flows of –$28,800, $10,400,
$13,100, $15,000, $12,100 and –$8,600 for years 0 to 5,
respectively. Should this project be accepted based...

What is the payback period for the following set of cash
flows?
(Round answer to two decomals, i.e. 32.16)
Period
Cash Flow
0
-6700
1
2200
2
3800
3
2600
4
4000

You are considering a project
with the following set of cash flows:
Cash
flow
0
-5,500
1
2,000
2
3,000
3
1,000
4
2,000
a. What is
the payback period of this project? If the
pre-specified cut off is 3 years,
should this project be accepted?
b. What is
the discounted
payback period of this
project? If the
pre-specified cut off is 3 years, should this project be
accepted? The discount rate is
10%.

Find the discounted payback period for the following cash
flows.
Year
Cash Flow
0
-319,000
1
122,000
2
133,000
3
135,000
4
395,000
Assume a discount rate of 13%.
Round your answer to two decimal places.

Guerilla Radio Broadcasting has a project available with the
following cash flows :
Year Cash Flow
0: −$15,200
1: 6,300
2: 7,600
3: 4,700
4: 4,300
What is the payback period?

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