Sal Is Considering a Project That Costs $15,000

question 375

Multiple Choice

Sal is considering a project that costs $15,000. The project produces cash inflows of $3,000, $5,000, $7,000, and $3,000 respectively for the next four years. Sal wants to recoup his money
Within 3 years after applying a 6% discount rate. Sal should:

• A) Accept the project because it produces $15,534 on a discounted payback basis.
• B) Accept this project because the discounted payback period is 2.78 years.
• C) Accept this project because the payback period is exactly 3 years.
• D) Reject this project because the payback period is 2.78 years.
• E) Reject this project because the discounted payback period is 3.78 years.

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Definitions:

Ambulatory Surgery Centre

A healthcare facility specializing in outpatient surgical procedures that do not require hospital admission.

Preoperative Holding Area

A designated area in a hospital where patients are prepared for surgery, including pre-surgical assessments and administration of pre-anesthetic medications.

Surgical Dressing

Materials used to protect and promote healing in a wound, especially after surgery, by keeping it clean and absorbing any discharge.

Electrolyte Imbalance

An abnormality in the concentration of electrolytes in the body, which can disrupt various bodily functions.