A company is considering investing in a new project that will require an initial investment of $500,000. The project is expected to generate cash flows of $150,000 per year for 6 years. The company's cost of capital is 8%. What is the payback period of the project? Should the company invest in this project? Explain.

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The detailed answer for the above question is provided below The payback period is the length of time it takes for the initial investment to be recove... View the full answer