A firm decides to invest in an asset with an initial cost of Php2 million. Over the next five years, the firm then receives positive cash flows of year 1 = Php900,000, year 2 = Php600,000, year 3= Php400,000, year 4 = Php=300,000 that diminish over time. What is the payback period using the formula below
A firm decides to invest in an asset with an initial cost of Php2 million. Over the next five years, the firm then receives positive cash flows of year 1 = Php900,000, year 2 = Php600,000, year 3= Php400,000, year 4 = Php=300,000 that diminish over time. What is the payback period using the formula below
Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter13: Capital Budgeting: Estimating Cash Flows And Analyzing Risk
Section: Chapter Questions
Problem 4MC
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A firm decides to invest in an asset with an initial cost of Php2 million. Over the next five years, the firm then receives positive cash flows of year 1 = Php900,000, year 2 = Php600,000, year 3= Php400,000, year 4 = Php=300,000 that diminish over time. What is the payback period using the formula below.
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