Break even time = 3 years + (15,933/22,242) = 3.72 years (c) If the required payback period is more than 2.86 years, the project is acceptable. If the required break-even time is greater than 3.72 years, the project is acceptable. In addition, the internal rate of return is greater than the 12% hurdle rate.
What will be an ideal response?
$85,000/($11,250 + $8,500 = 4.3 years
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