Minor Company Is Going to Invest in a New Product

question 75

Multiple Choice

Minor Company is going to invest in a new product line.Minor estimates that the net cash flows from the new line will be $25,000 per year.The initial investment required to implement the new line will be $500,000.The company requires a rate of return of 8% and the new product line is expected to span a time period of 15 years.What is the payback period for the new product line?

• A) 1.6 years
• B) 12.5 years
• C) 20 years
• D) 25 years

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Definitions:

Therapeutic

Pertaining to the healing of disease or disorders; often used in the context of interventions, treatments, or practices that aim to provide relief or recovery.

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Connections between individuals in a society based on kinship, marriage, work, or social interests.

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A network of social interactions and personal relationships or a platform that facilitates these interactions online.

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