Multiple Choice
Malive Park Department is considering a new capital investment. The following information is available on the investment. The cost of the machine will be $179,000. The annual cost savings if the new machine is acquired will be $35,000. The machine will have a 10-year life, at which time the terminal disposal value is expected to be zero. Malive Park is assuming no tax consequences. Malive Park has a 14% required rate of return. What is the payback period for the investment?
A) 4.1 years
B) 5.1 years
C) 10.0 years
D) 10.2 years
Correct Answer:
Verified
Correct Answer:
Verified
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