# Consider the following cash flows in Table P5.5. (a) Calculate the payback period for each project. (b) Determine whether it

## Question:

(a) Calculate the payback period for each project.

(b) Determine whether it is meaningful to calculate a payback period for project D.

(c) Assuming that i = 12%, calculate the discounted payback period for each project.

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,...

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