Question $3$

A company is considering a project with the following

cash flows:

Initial investment: $$133,000$

Annual cash flows: $$47,000$ per year for $8$ years

Equipment refurbishment costs $($at the end of $6$

years$)$: $$29,000$

Salvage value of equipment $($at the end of $8$

years$)$: $$9,000$

What is the Payback Period $($in years$)$ for this

project? $($Round to two decimal places.$)$ For reference, abbreviated versions of the present value tables from Chapter $12$ are below. Use these

tables for any present value calculations in the following questions.

Present Value of an ordinary annuity of $$1$ received at the end of the period for $n$ periods.