Suppose one firm imposes a payback cutoff of three years for its international investment projects....
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Suppose one firm imposes a payback cutoff of three years for its international investment projects. If the company has the following two projects available. The first project has costs $65,000, and earns $35,000 in the first year, $31,000 in the second year, $21,000 and $8,000 for the third and fourth year. The second one has costs $70,000 and earns $23,000, $28,000, $21,000 and $220,000 in the first, second, third and fourth year respectively. Whats the payback period for the first project ? Group of answer choices 1.03 1.97 2.03 2.9 2.97 Whats the payback period for the second project ? Group of answer choices 1.03 1.97 2.03 2.9 2.97 Based on Payback rule, which investment should be accepted? Group of answer choices Only the first one Only the second one Both can be accepted Neither can be accepted
Suppose one firm imposes a payback cutoff of three years for its international investment projects. If the company has the following two projects available. The first project has costs $65,000, and earns $35,000 in the first year, $31,000 in the second year, $21,000 and $8,000 for the third and fourth year. The second one has costs $70,000 and earns $23,000, $28,000, $21,000 and $220,000 in the first, second, third and fourth year respectively. Whats the payback period for the first project ?
Group of answer choices
1.03
1.97
2.03
2.9
2.97
Whats the payback period for the second project ?
Group of answer choices
1.03
1.97
2.03
2.9
2.97
Based on Payback rule, which investment should be accepted?
Group of answer choices
Only the first one
Only the second one
Both can be accepted
Neither can be accepted
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