What is the discounted payback period

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Question

An investment project costs $10,000 and has annual cash flows of $2,920 for six years.

What is the discounted payback period if the discount rate is zero percent? (Do not round intermediate calculations. Enter 0 if the project never pays back. Round your answer to 2 decimal places, e.g., 32.16.)

Discounted payback period 3.425 years (correct)

What is the discounted payback period if the discount rate is 4 percent? (Do not round intermediate calculations. Enter 0 if the project never pays back. Round your answer to 2 decimal places, e.g., 32.16.)

Discounted payback period 3.65 years (Incorrect)

What is the discounted payback period if the discount rate is 21 percent? (Do not round intermediate calculations. Enter 0 if the project never pays back. Round your answer to 2 decimal places, e.g., 32.16.)

Discounted payback period 0 years (correct)

Reference no: EM132315738

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