Find payback and discounted payback periods

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Your sleep disorder clinic wants to update its systems with a purchase of software for $40,000, with projected cash flows (salary savings) of $15,000 per year during the software's useful life. What are the payback and discounted payback periods if the cost of capital is 10%? If the clinic has a three-year payback cap on all new purchases, should this purchase be made? Explain.

Reference no: EM133048297

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