26) What is the payback period for an investment project with an upfront cost $3,000,000, but...
26) What is the payback period for an investment project with an upfront cost $3,000,000, but benefits of $200,000 a year, each year, forever? (Note: Enter the number of years as your answer, but do not enter “years”, just the number.)
Homework Answers
Payback period is the period within which the investment is recovered.
Payback period = Total investment / annual benefits
= 3000000/200000
= 15
The investment will be recovered in 15 years.
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