Compute the Payback Statistic for Project X and Recommend Whether

question 55

Multiple Choice

Compute the Payback statistic for Project X and recommend whether the firm should accept or reject the project with the cash flows shown below if the appropriate cost of capital is 9 percent and the maximum allowable payback is 4 years.

• A) 3.4375 years, accept
• B) 3.78 years, reject
• C) 4.4375 years, reject
• D) 4.78 years, accept

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Definitions:

Outpouchings

Bulges or protrusions from a hollow structure in the body.

Efficient Respiratory System

A highly effective system in organisms for the exchange of gases—oxygen and carbon dioxide—between an organism and its environment, ensuring adequate oxygenation of tissues for metabolic needs.

Stale Air

Air that has become unfit for breathing due to poor circulation or presence of pollutants, causing discomfort or health issues.

Partial Pressure

The pressure contributed by a single type of gas in a mixture of gases.