The Net Initial Investment for a New Mainframe Computer Is

question 111

Multiple Choice

The net initial investment for a new mainframe computer is $2,000,000.Annual cash flows are expected to increase by $800,000 per year.The equipment has a 10-year useful life.What is the payback period?

• A)4.00 years
• B)2.50 years
• C)2.00 years
• D)1.75 years
• E)0.75 years

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Definitions:

Instinct

An innate, typically fixed pattern of behavior in animals in response to certain stimuli.

Statistically Significant

A term indicating that a result from data analysis is not likely to occur by chance, implying it is meaningful in the context of the hypothesis being tested.

Sample Groups

Selected subsets of a population used in research studies to represent the entire group from which they were chosen.

Chance Variation

Random fluctuations that affect data or experimental outcomes, not attributable to any specific cause.