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Carr Company is considering two capital investment proposals.Estimates regarding each project are provided below: The company requires a 10% rate of return on all new investments.
-The cash payback period for Project Soup is

Question

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Carr Company is considering two capital investment proposals.Estimates regarding each project are provided below:  The company requires a 10% rate of return on all new investments. 
-The cash payback period for Project Soup is

Quizplus · Accepted Answer

The cash payback period for Project Soup is 3 years, which is shorter than the cash payback period for Project Stew, which is 4 years. Therefore, Project Soup is the better choice in terms of cash payback period. However, it is important to also consider other factors such as net present value, internal rate of return, and profitability index before making a final decision.

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