What is the payback period

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Consider an investment that costs $100,000 and has a cash inflow of $25,000 every year for 5 years. The required return is 9% and required payback is 4 years.

  • What is the payback period?
  • What is the NPV?
  • What is the IRR?
  • Should we accept the project?

What decision rules should be the primary decision method? Give reasons and show how they are calculated.

When is the IRR rule unreliable? What is MIRR and what are three methods of MIRR. Give examples of each method.

Reference no: EM133114217

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