GuSont Inc Assume That Cash Inflows Occur Evenly Throughout the Year

question 38

Multiple Choice

GuSont Inc. was considering an investment in the following project: $\begin{array}{lrr}\text { Required initial investment } & \$ 990,000 \\\text { Net annual after-tax cash inflow } & \$ 165,000 \\\text { Annual depreciation expense }(\$ 990,000-\$ 165,000) / 15 \text { years } & \$ 55,000 \\\text { Estimated salvage value } & \$ 165,000 \\\text { Life of the project in years } & 15\end{array}$ Assume that cash inflows occur evenly throughout the year. The estimated payback period in years (rounded to one decimal place) for the proposed project is:

• A) 3.7 years.
• B) 4.6 years.
• C) 5.8 years.
• D) 6.0 years.
• E) 7.9 years.

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Definitions:

Consciousness

The quality or state of being aware of an external object or something within oneself, regarded as a defining aspect of the human experience.

EEG

A test that detects electrical activity in the brain using small, flat metal discs attached to the scalp.

Prefrontal Cortex

refers to the front part of the frontal lobe of the brain, which is involved in complex cognitive behavior, personality expression, decision making, and moderating social behavior.

Limbic System

A complex system of nerves and networks in the brain, involved in basic emotions (such as fear and pleasure) and drives (such as those for food and sex).