The process for producing a fruit-tree pesticide has a first cost of $200,000 (initial investment at...
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The process for producing a fruit-tree pesticide has a first cost of $200,000 (initial investment at year 0) with annual operating cost of $45,000 and revenue of $135,000 per year starting 5 years from now. In the 6th year, $12000 was given to the company by Environmental Protection Agency as credit for its environmental compliance. What is the payback period at: a) 0% b) 11% Given that the two guess values for x number of years to be between 3 yrs and 4 yrs at 11% from the 5th year. Ensure you draw one cash flow diagram for the two interest rates. The process for producing a fruit-tree pesticide has a first cost of $200,000 (initial investment at year 0) with annual operating cost of $45,000 and revenue of $135,000 per year starting 5 years from now. In the 6th year, $12000 was given to the company by Environmental Protection Agency as credit for its environmental compliance. What is the payback period at: a) 0% b) 11% Given that the two guess values for x number of years to be between 3 yrs and 4 yrs at 11% from the 5th year. Ensure you draw one cash flow diagram for the two interest rates.
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Answer a 0 Payback period 3 years The cash flow diagram is as follo... View the full answer
Related Book For
Financial Management for Public Health and Not for Profit Organizations
ISBN: 978-0132805667
4th edition
Authors: Steven A. Finkler, Thad Calabrese
Posted Date:
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