View Policies Current Attempt in Progress Linda is hoping that an investment of $30,000 will provide additional revenue to the store of $18,000 per year for 3 years. Her partner in crime, Robert, is confident that a larger investment of $40,200 will be required to bring in a steady flow of $22,800 in new revenue per year for 3 years. Determine the discounted payback period for each investment (using before-tax cash flows). The company's required rate of return is 8%. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and final answers to 2 decimal places e.g. 15.25.) Click here to view the factor table Discounted payback period Linda years Whose investment appears to better use the company's resources? Robert years

Personal Finance
13th Edition
ISBN:9781337669214
Author:GARMAN
Publisher:GARMAN
Chapter13: Investment Fundamentals
Section: Chapter Questions
Problem 1DTM
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Current Attempt in Progress
Linda is hoping that an investment of $30,000 will provide additional revenue to the store of $18,000 per year for 3 years. Her partner
in crime, Robert, is confident that a larger investment of $40,200 will be required to bring in a steady flow of $22,800 in new revenue
per year for 3 years.
Determine the discounted payback period for each investment (using before-tax cash flows). The company's required rate of return is
8%. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and final answers to 2 decimal places e.g. 15.25.)
Click here to view the factor table
Discounted payback period
Linda
years
Whose investment appears to better use the company's resources?
Robert
years
Transcribed Image Text:View Policies Current Attempt in Progress Linda is hoping that an investment of $30,000 will provide additional revenue to the store of $18,000 per year for 3 years. Her partner in crime, Robert, is confident that a larger investment of $40,200 will be required to bring in a steady flow of $22,800 in new revenue per year for 3 years. Determine the discounted payback period for each investment (using before-tax cash flows). The company's required rate of return is 8%. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and final answers to 2 decimal places e.g. 15.25.) Click here to view the factor table Discounted payback period Linda years Whose investment appears to better use the company's resources? Robert years
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