Determine the payback period for the given project


Problem: Jordan Enterprises is considering a capital expenditure that requires an initial investment of $42,000 and returns after-tax cash inflows of $7,000 per year for 10 years. The firm has a maximum acceptable payback period of 8 years.

a) Determine the payback period for this project

b) Should the company accept the project? Why or why not?

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Finance Basics: Determine the payback period for the given project
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