Use the table for the question(s)below.
Consider the following two projects:

-The payback period for project B is closest to:
A)2.5 years
B)2.0 years
C)2.2 years
D)2.4 years
E)3.0 years

Question

Use the table for the question(s)below.
Consider the following two projects:
 
-The payback period for project B is closest to:
A)2.5 years 
B)2.0 years 
C)2.2 years 
D)2.4 years 
E)3.0 years

Quizplus · Accepted Answer

The payback period is the time it takes for a project to recover its initial investment. To determine the closest payback period for project B, we would typically analyze the project's cash flow to see how long it takes for the cumulative cash flow to become positive, equaling the initial investment. Without specific cash flow details for project B, we can't calculate the exact payback period here. However, based on the question's structure, if D (2.4 years) is presented as the correct answer, it suggests that with the given or assumed cash flows, the cumulative cash flow equals the initial investment closest to 2.4 years.

Use the Table for the Question(s)below