Ventura Manufacturing is considering an investment in a new automated manufacturing system. The new system requires an

Question:

Ventura Manufacturing is considering an investment in a new automated manufacturing system. The new system requires an investment of $ 3,000,000 and either has
(a) Even cash flows of $ 750,000 per year or
(b) The following expected annual cash flows: $ 375,000, $ 375,000, $ 1,000,000, $ 1,000,000, and $ 250,000.
Required:
Calculate the for each case. Payback Period
Payback period method is a traditional method/ approach of capital budgeting. It is the simple and widely used quantitative method of Investment evaluation. Payback period is typically used to evaluate projects or investments before undergoing them,...