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Compute the traditional payback period

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Question - Compute the traditional payback period for an expansion project that costs $700,000 and that is expected to generate incremental net cash flows of $250,000 per year. If the management team cannot currently accept any projects that have a payback period longer than 3 years should they go ahead and recommend this project to the company's board of directors? Calculate the payback period and decide whether management should approve the expansion.

Reference no: EM132888113

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