Determine the discounted payback period

Reference no: EM13287244

The local hospital has just implemented a totally automated switchboard that cost $205,000 to install. The switchboard replaced four operators who were paid $15K annually. Fringe benefits (vacation, sick leave, insurance, etc.) cost the hospital 42% of each annual salary. The switchboard will last 10 years, and the hospital uses a 5% interest rate. (A) Determine the benefit/cost ratio. (B) Determine the payback period. (C) Determine the discounted payback period.

Reference no: EM13287244

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