If a Proposed Expenditure of $80,000 for a Fixed Asset

question 98

True/False

If a proposed expenditure of $80,000 for a fixed asset with a 4-year life has an annual expected net cash flow and net income of $32,000 and $12,000, respectively, the cash payback period is 2.5 years.

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Definitions:

Average Waiting Time

The average time that a customer or item spends waiting in a queue before being served.

μ

Typically represents the mean of a population in statistics, or the average arrival or service rate in queuing theory contexts.

Finite Population

A population that consists of a fixed, limited number of entities or elements, making it countable and not infinite.

Queue

A line of people or items waiting for service or processing, often analyzed in operations to reduce wait times.