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A project has an initial cost of $54,300, expected net cash inflows of $14,000 per year...

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Finance

A project has an initial cost of $54,300, expected net cashinflows of $14,000 per year for 9 years, and a cost of capital of13%. What is the project's payback period? Round your answer to twodecimal place

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Calculation of pay back period:
Time Amount Cumulative
                                                                                      -         (54,300.00)         (54,300.00)
                                                                                 1.00         14,000.00         (40,300.00)
                                                                                 2.00         14,000.00         (26,300.00)
                                                                                 3.00         14,000.00         (12,300.00)
                                                                                 4.00         14,000.00             1,700.00
                                                                                 5.00         14,000.00           15,700.00
                                                                                 6.00         14,000.00           29,700.00
                                                                                 7.00         14,000.00           43,700.00
                                                                                 8.00         14,000.00           57,700.00
                                                                                 9.00         14,000.00           71,700.00
PBP= 3+12300/14000
PBP= 3.88 years

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