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Question 1 (1 point) What is the simple (undiscounted) payback period in years for a $100,000 project with expected cash flow
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Answer #1

Hello SIr/ Mam

YOUR REQUIRED ANSWER IS 7.5 years

The Cashflow Schedule:

Time Cashflows Cumulative Casshflows
0 -100000 -100000
1 17000 -83000
2 17000 -66000
3 12000 -54000
4 12000 -42000
5 12000 -30000
6 12000 -18000
7 12000 -6000
8 12000 6000

Hence, PBP = 7 years + (6000/12000) * 1 year = 7.5 years

I hope this solves your doubt.

Feel free to comment if you still have any query or need something else. I'll help asap.

Do give a thumbs up if you find this helpful.

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