It will cost $8,500 to acquire an ice-cream cart that is expected to produce cash inflows of $3,600 a year for three years

Finance Dec 23, 2020

It will cost $8,500 to acquire an ice-cream cart that is expected to produce cash inflows of $3,600 a year for three years. After the three years, the cart is expected to be worthless. Find the payback period. 2.67 vears 2.25 years 2.36 years 1.98 years 3.12 years

Expert Solution

Payback Period(when cash inflow per year is sane) = Initial Investment/Cash Inflow = 8500/3600 = 2.36 years

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