Jarvey Corporation is studying a project that would have a ten-year life and would require a $450,000 investment in equipment which has no salvage value. The project would provide net operating income each year as follows for the life of the project (Ignore income taxes.): The company's required rate of return is 12%. The payback period for this project is closest to:
A) 3 years
B) 2 years
C) 4.28 years
D) 9 years

Question

Jarvey Corporation is studying a project that would have a ten-year life and would require a $450,000 investment in equipment which has no salvage value. The project would provide net operating income each year as follows for the life of the project (Ignore income taxes.):  The company's required rate of return is 12%. The payback period for this project is closest to:
A) 3 years 
B) 2 years 
C) 4.28 years 
D) 9 years

Quizplus · Accepted Answer

The Answer of Jarvey Corporation is studying a project that would have a ten-year life and would require a $450,000 investment in equipment which has no salvage value. The project would provide net operating income each year as follows for the life of the project (Ignore income taxes.):  The company's required rate of return is 12%. The payback period for this project is closest to:
A) 3 years 
B) 2 years 
C) 4.28 years 
D) 9 years

Jarvey Corporation Is Studying a Project That Would Have a Ten-Year