Mystery Co

question 2

Multiple Choice

Mystery Co.is considering purchasing a new piece of equipment that will cost $600,000.The equipment has an estimated useful life of 8 years and no salvage value.The equipment will produce cash inflows of $215,000 per year and net income of $90,000 per year.Mystery requires a 10% rate of return.What is the payback period for this equipment?

• A)8.0 years
• B)3.75 years
• C)2.79 years
• D)6.67 years

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Definitions:

Disorganization-Despair

A phase in attachment theory where an individual shows intense distress and confusion due to a significant loss or separation.

Somatic Death

The physical death of the body tissues after the cessation of biological functions that sustain a living organism.

Brain Death

A medical condition where all functions of the brain, including the brainstem, have irreversibly ceased, used as a legal definition of death in many jurisdictions.

Paralysis

The loss of the ability to move and sometimes to feel anything in part or most of the body, typically as a result of illness, poison, or injury.