Oxford Buses has a fleet of 200 buses and the divisional manager for the city is deciding whether to replace 50 buses (It replaces 50 of these buses with new buses every 4 years). Each new bus costs £1.2 million. The net profit per bus is expected to be £400,000 per year. Calculate the Payback Period (PP). Select one: OA 3 years OB. 4 years OC. 1 year OD. 2 years

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Oxford Buses has a fleet of 200 buses and the divisional manager for the city is deciding whether to replace 50 buses (It replaces 50 of these buses with new buses every 4 years). Each new bus costs £1.2 million. The net profit per bus is expected to be £400,000 per year.
Calculate the Payback Period (PP).
Select one:
OA 3 years
OB. 4 years
OC. 1 year
OD. 2 years
Transcribed Image Text:Oxford Buses has a fleet of 200 buses and the divisional manager for the city is deciding whether to replace 50 buses (It replaces 50 of these buses with new buses every 4 years). Each new bus costs £1.2 million. The net profit per bus is expected to be £400,000 per year. Calculate the Payback Period (PP). Select one: OA 3 years OB. 4 years OC. 1 year OD. 2 years
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