A Project Has an Initial Cost of $10,600 and Produces

question 40

Multiple Choice

A project has an initial cost of $10,600 and produces cash inflows of $3,700,$4,900,and $2,500 for Years 1 to 3,respectively.What is the discounted payback period if the required rate of return is 7.5 percent?

• A)2.65 years
• B)2.78 years
• C)2.94 years
• D)2.88 years
• E)Never

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Definitions:

Back-arc Basin

A geological feature located behind a volcanic arc, formed by the stretching and sinking of an oceanic plate.

Trench

Long, narrow, and deep depressions on the ocean floor, often occurring at the boundaries between tectonic plates.

Philippine Sea

A section of the western Pacific Ocean east of the Philippines, notable for its depth and marine biodiversity.

Island Arc

A chain of volcanic islands that form along a convergent tectonic plate boundary, typically where an oceanic plate subducts beneath another oceanic plate.