Today, Crunchy Snacks is investing $487,000 in a new oven. As a result, the company expects its cash flows to increase by $62,000 a year for the next two years and by $98,000 a year for the following three years. How long must the firm wait until it recovers all of its initial investment?
A) 3.97 years
B) 4.18 years
C) 4.46 years
D) 4.70 years
E) The project never pays back.

Question

Quizplus · Accepted Answer

The Answer of Today, Crunchy Snacks is investing $487,000 in a new oven. As a result, the company expects its cash flows to increase by $62,000 a year for the next two years and by $98,000 a year for the following three years. How long must the firm wait until it recovers all of its initial investment?
A) 3.97 years
B) 4.18 years
C) 4.46 years
D) 4.70 years
E) The project never pays back.

Today, Crunchy Snacks Is Investing $487,000 in a New Oven