The discounted payback period is the length of time it takes to break even on an investment in terms of the present value of cash inflows and outflows. However, if the discount rate is zero percent, this means that the value of future cash flows is not being reduced for the risk of time. Therefore, the discounted payback period is the same as the regular payback period.

Here's how to calculate it:

1. Determine the initial investment. In this case, it's $12,900.

2. Determine the annual cash inflow. In this case, it's $3,500.

3. Divide the initial investment by the annual cash inflow to find the payback period.

So, $12,900 / $3,500 = approximately 3.69 years.

This means that it will take approximately 3.69 years to recover the initial investment if the cash inflow is $3,500 per year and the discount rate is zero percent.

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The discounted payback period is the length of time it takes to break even on an investment in terms of the present value of cash inflows and outflows. However, if the discount rate is zero percent, this means that the value of future cash flows is not being reduced for the risk of time. Therefore, the discounted payback period is the same as the regular payback period.

Here's how to calculate it:

1. Determine the initial investment. In this case, it's $12,900.

2. Determine the annual cash inflow. In this case, it's $3,500.

3. Divide the initial investment by the annual cash inflow to find the payback period.

So, $12,900 / $3,500 = approximately 3.69 years.

This means that it will take approximately 3.69 years to recover the initial investment if the cash inflow is $3,500 per year and the discount rate is zero percent.

Knowee AI · Accepted Answer

The discounted payback period is the length of time it takes to break even on an investment in terms of the present value of cash inflows and outflows. However, if the discount rate is zero percent, this means that the value of future cash flows is not being reduced for the risk of time. Therefore, the discounted payback period is the same as the regular payback period.

Here's how to calculate it:

1. Determine the initial investment. In this case, it's $12,900.

2. Determine the annual cash inflow. In this case, it's $3,500.

3. Divide the initial investment by the annual cash inflow to find the payback period.

So, $12,900 / $3,500 = approximately 3.69 years.

This means that it will take approximately 3.69 years to recover the initial investment if the cash inflow is $3,500 per year and the discount rate is zero percent.

An investment project costs $12,900 and has annual cash flows of $3,500 for six years. a. What is the discounted payback period if the discount rate is zero percent?

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