Consider an investment with an initial cost of $20,000 and is that expected to last...
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Finance
Consider an investment with an initial cost of $20,000 and is that expected to last for 5 years. The expected cash flows in years 1 and 2 are $5,000, in years 3 and 4 are $5,500 and in year 5 is $1,000. The total cash inflow is expected to be $22,000 or an average of $4,400 per year. Compute the payback period in years.
Select one:
a. 3.18 years
b. 3.82 years
c. 4.00 years
d. 4.55 years
e. None of the above
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