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Yen has a project that requires an investment of $500 at t=0 and then generates $100,...

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Finance

Yen has a project that requires an investment of $500 at t=0 andthen generates $100, $200, $300, and $400 in the next four years(from t=1 to t=4). What is the payback period in years?

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4.4 Ratings (596 Votes)
Cash outflow at t0 Initial investment 500 We get the following cash flows for the project Year 0 1 2 3 4 Cash Flow 500 100 200 300 400 To find the payback period we need to find the cumulative cash flow for the project Cumulative cash    See Answer
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Transcribed Image Text

Yen has a project that requires an investment of $500 at t=0 andthen generates $100, $200, $300, and $400 in the next four years(from t=1 to t=4). What is the payback period in years?

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