Question: Hardware is adding a new product line that will require an investment of $1,510,000. Managers estimate that this investment will have a 10-year life and
Hardware is adding a new product line that will require an investment of $1,510,000. Managers estimate that this investment will have a 10-year life and generate net cash inflows of $325,000 the first year, $285,000 the second year, and $260,000 each year thereafter for eight years. The investment has no residual value. Compute the payback period and show the formula.
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