Compute the payback period for a project with the following cash flows, - 3705

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Compute the payback period for a project with the following cash flows, if the company’s discount rate is 12%. Initial outlay = $450 

Cash flows:Year 1=$325

Year 2=$ 65

Year 3=$100

 

A. 

3.17 years

B. 

2.88 years

C. 

3.43 years

D. 

2.6 years

Solution Description

 Compute the payback period for a project with the following cash flows, if the company’s discount rate is 12%. Initial outlay = $450

Cash flows:

Year 1

=

$325