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Consider the following cash flows: Year Cash Flow -$7,800 3,100 3,200 2,200 1,400 Nm What is the payback period for the above

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Answer #1

Payback Period is the time period when initial investment comes back as cash inflow,

Payback Period = 1(3,100) + 1(3,200) + 0.68(1,500/2,200)

Payback Period = 2.68 years

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