A Company Is Evaluating an Investment Proposal Using the Payback

question 15

Multiple Choice

A company is evaluating an investment proposal using the payback period method.Cash inflows are expected to be $80 000 in year 1,$120 000 in year 2,$150 000 in year 3,and $180 000 in year 4.The initial investment required is $380 000.Assuming even cash inflows throughout each year,the payback period is:

• A) 3 years.
• B) 3.17 years.
• C) 3.34 years.
• D) 3.47 years.

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Definitions:

Divisions Perform

Divisions perform refers to the operational and financial performance of separate business units or segments within a larger company, often evaluated to assess their contribution to the overall success of the corporation.

Production Function

An economic model that expresses the relationship between inputs and the maximum output that can be produced with those inputs.

Organizational Architecture

The structure and systems in place within an organization that shape its behavior and performance.

Intermediate Products

Goods that are produced by one enterprise for use in further processing or manufacturing by another entity.