Discounted payback period. Becker, Inc. uses the discounted payback period for projects costing less than...
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Discounted payback period. Becker, Inc. uses the discounted payback period for projects costing less than $25,000 and has a cutoff period of four years for these small-value projects. Two projects, R and S, in the following table, E. are under consideration. Their anticipated cash flows are listed in the following table. If Becker uses a discount rate of 6% on these projects, are they accepted or rejected? If it uses a discount rate of 12%? A discount rate of 18%? Why is it necessary to look at only the first four years of the projects' cash flows? With a discount rate of 6%, the cash outflow for project R is: (Select the best response.) Data Table O A. fully recovered in 4 years, so accept. O B. fully recovered in 3 years, so reject. O C. fully recovered in 5 years, so accept. OD. not fully recovered in four years, so reject. (Click on the following icon in order to copy its contents into a spreadsheet.) Cash Flow Initial Cost Cash flow year 1 Cash flow year 2 Cash flow year 3 Cash flow year 4 Project R $21,000 $4,200 $6,300 Projects $16,000 $8,000 $6,400 $4,800 $3,200 $8,400 $10,500 Print Done Click to select your answer and then click Check Answer. ? 6 parts remaining Clear All Check
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