Use the following information to answer the following question(s).
Below are the expected after-tax cash flows for Projects Y and Z.Both projects have an initial cash outlay of $20,000 and a required rate of return of 17%.

-Discounted payback for Project Y is:
A)three years.
B)3.14 years.
C)four years.
D)two years.

Question

Use the following information to answer the following question(s).
Below are the expected after-tax cash flows for Projects Y and Z.Both projects have an initial cash outlay of $20,000 and a required rate of return of 17%.
 
-Discounted payback for Project Y is:
A)three years. 
B)3.14 years. 
C)four years. 
D)two years.

Quizplus · Accepted Answer

Discounted payback period accounts for the time value of money and is the time it takes for the present value of cash inflows to cover the initial investment. In this case, it is 3.14 years.

Use the Following Information to Answer the Following Question(s)