An investment project costs $16,800 and has annual cash flows of $4,100 for six years. a. What is the discounted payback period if the discount rate is zero percent? b. What is the discounted payback period if the discount rate is 6 percent? c. What is the discounted payback period if the discount rate is 21 percent?

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter11: Capital Budgeting Decisions
Section: Chapter Questions
Problem 16EB: Project Y cost $8,000 and will generate net cash inflows of $1,500 in year one, $2,000 in year two,...
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An investment project costs $16,800 and has annual cash flows of $4, 100 for six years. a. What is the
discounted payback period if the discount rate is zero percent? b. What is the discounted payback
period if the discount rate is 6 percent? c. What is the discounted payback period if the discount rate is
21 percent?
Transcribed Image Text:An investment project costs $16,800 and has annual cash flows of $4, 100 for six years. a. What is the discounted payback period if the discount rate is zero percent? b. What is the discounted payback period if the discount rate is 6 percent? c. What is the discounted payback period if the discount rate is 21 percent?
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