Ambinu Flower Company Provides Flowers and Other Nursery Products for Decorative

question 45

Multiple Choice

Ambinu Flower Company provides flowers and other nursery products for decorative purposes in medium to large sized restaurants and businesses.The company has been investigating the purchase of a new specially equipped van for deliveries.The van has a value of $113,750 with a seven-year life.The expected additional cash inflows are $32,500 per year.What is the payback period for this investment?

• A) 3 years
• B) 3.5 years
• C) 6 years
• D) 4 years

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Definitions:

Technological Advancements

Progress in technology that can lead to improved products, services, or processes, often contributing to increased efficiency or effectiveness.

Consumption Patterns

The typical manner in which individuals or groups use, purchase, and dispose of goods and services.

Market Segments

The process of dividing a broad target market into smaller, more homogeneous groups of customers with similar needs, characteristics, or behaviors.

Consumer Price Points

Predetermined prices at which customers are willing to buy a product or service.