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Problem:

The Seattle Corporation has been presented with an investment opportunity which will yield cash flows of $30,000 per year in Years l through 4; $35,000 per year in Years 5 through 9; and $40,000 in Year l0. This investment will cost the firm $150,000 today, and the firm's cost of capital is 10 percent. Assume cash flows occur evenly during the year.

Required:

Question: What is the payback period for this investment (one decimal point)?

Note: Please provide through step by step calculations.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91169866

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