Determine the discounted payback period of machine Alpha that has cashflows occurring evenly during the year as follows:

Year end	Machine Alpha (Shs ‘000’)
0	(1,250)
1	600
2	400
3	350
4	230
5	500
6	300

Discount factor is 11% per annum.

Select one:

A. 2 years, 8.6 months

B. 1 years, 5 months

C. 3 years, 5.3 months

D. 4 years, 7.9 months

Answer rating: 100% (QA)

To calculate the discounted payback period we need to determine the point at which the cumulative di... View the full answer