Three investments cost $5,000 each and have the following cash flows. Rank them on the basis of

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Three investments cost $5,000 each and have the following cash flows. Rank them on the basis of their payback periods. Does the ranking make intuitive sense?

Year A $2,000 $3,000 2 1,000 1,000 3,000 2,000 2,000 2,000 2,000 1,000 500 4 7,000 2,000

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Basic Finance An Introduction to Financial Institutions, Investments and Management

ISBN: 978-1285425795

11th Edition

Authors: Herbert B. Mayo

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Question Posted: Nov 20, 2018 12:32 PM

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Three investments cost $5,000 each and have the following cash flows. Rank them on the basis of

Question:

Year A $2,000 $3,000 2 1,000 1,000 3,000 2,000 2,000 2,000 2,000 1,000 500 4 7,000 2,000

Step by Step Answer:

Payback for A 25 years 2 years and 6 months Payback for B 2 years Payback for C 3 years B...View the full answer

Basic Finance An Introduction to Financial Institutions, Investments and Management

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