Calculating discounted payback

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Calculating Discounted Payback

As the financial manager for a professional services firm, you are presented with three projects for the company to invest in. Each project's investment is promising to increase the entire firm's productivity and billable hours. All three projects provide the same estimated annual cash inflows of $12,000, $13,000, $13,500, $15,000, $15,250, and $16,000. The firm's required rate of return is 12% and the three investment projects require an initial cost of $18,000, $22,000, and $36,000, respectively. Construct a cash flow model and calculate the discounted payback period for each of these projects.

Reference no: EM133072387

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