Homework Answers
Cash flow
| Year | Cash flow | Cumulative cash flow |
| 0 | -1130000 | -1130000 |
| 1 | 400000 | -730000 |
| 2 | 420000 | -310000 |
| 3 | 400000 | 90000 |
payback period = 2 years+310000/400000 = 2.78 years
So answer is b) 2.78 Years
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#2
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