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Determine the payback period for project

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Reference no: EM132804636

Janelle Melinda Company is considering a capital expenditure that requires an initial investment of $45,000 and returns after-tax cash inflows of $5,000 per year for 12 years. The firm has a maximum acceptable payback period of 7 years.

a) Determine the payback period for this project.

b) Should the company accept the project? Why or why not?

Reference no: EM132804636

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