Project K costs $50,000, its expected cash inflows are $12,000 per year for 8 years, and its WACC is 12%. What is the project's discounted payback? Round your answer to two decimal places. years
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We can use the formula for the present value of an annuity: PV = CF * (1 - (1 + r)^(-n)) / r Where: PV = Present value CF = Cash flow per period r = Discount rate (WACC) n = Number of periods In this case, CF = $12,000, r = 12% (0.12), and n = 8. PV = $12,000 Show more…
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