Ginny Trueblood Is Considering an Investment Which Will Cost Her

question 46

Multiple Choice

Ginny Trueblood is considering an investment which will cost her £120,000.The investment produces no cash flows for the first year.In the second year the cash inflow is £35,000.This inflow
Will increase to £55,000 and then £75,000 for the following two years before ceasing permanently.
Ginny requires a 10% rate of return and has a required discounted payback period of three years.
Ginny should _____ this project because the discounted payback period is _____.

• A)accept; 2.03 years
• B)accept; 2.97 years
• C)accept; 3.97 years
• D)reject; 3.03 years
• E)reject; 3.97 years

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Definitions:

National Organization of Women

An American feminist organization founded in 1966 to advocate for women’s rights and equality.

Liberal Congressmen

Liberal Congressmen are members of the United States Congress who advocate for liberal policies, including social equality, environmental protection, and economic regulation for public welfare.

Voting Rights Act

The Voting Rights Act of 1965 is landmark federal legislation in the United States aimed at overcoming legal barriers at the state and local levels that prevented African Americans from exercising their right to vote under the 15th Amendment.

Tenth Amendment

The Tenth Amendment to the United States Constitution, part of the Bill of Rights, expresses the principle that the federal government possesses only those powers delegated to it by the states or the people.