Question: Hi-Five Industries are considering a project that will have initial cost of RM500,000. It is expected to produce cash flows of RM125,000 per year for

Hi-Five Industries are considering a project that will have initial cost

Hi-Five Industries are considering a project that will have initial cost of RM500,000. It is expected to produce cash flows of RM125,000 per year for 10 years, with the first cash flow begins in one year. Hi -Five Ind, cost of capital is 11% and firm's preferred payback period is within three years or less. i) What would be the payback period of this project? (4 marks) ii) Should Hi-Five take the project if it wants to increase the value of the company

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