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Determine the payback period

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Question - An investment that costs $120,000 is estimated to reduce cash operating costs by $40,000 per year for 4 years. The required rate of return is 10 percent. Determine the payback period, assuming inflation is negligible.

a. About 2.92 years

b. About 2.66 years

c. About 3 years

d. About 2.79 years

Reference no: EM132779464

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