document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=1107721>Question 1107721</A>: <I><SPAN STYLE=\"word-break: break-all;\"> A company is considering investing on a particular project. The alternative projects available are: Project A that costs $. 300,000, and Project B that Costs $. 170,000. The net cash inflows estimates are as follows:\r<BR>\n" );
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document.write( " 			Net Cash Inflow<BR>\n" );
document.write( "Year	        Project A		      Project B<BR>\n" );
document.write( "  1		40,000			30,000<BR>\n" );
document.write( "  2		50,000			50,000<BR>\n" );
document.write( "  3		90,000			70,000<BR>\n" );
document.write( "  4		100,000			30,000<BR>\n" );
document.write( "  5		40,000			45,000<BR>\n" );
document.write( "A. Calculate payback period for each project<BR>\n" );
document.write( "B. Which project do you think will have shorter payback period? <BR>\n" );
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document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #722846 by </B><A HREF=/tutors/aboutme.mpl?userid=Theo><B>Theo(13342)</B></A><img src=\"/images/stars/stars-13.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=Theo><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/cgi-bin/show-face.mpl?user=Theo><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=722846\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> i believe you need to provide the discount rate as well.<BR>\n" );
document.write( "i didn't see it anywhere.\r<BR>\n" );
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document.write( "you would then need to get the present valueof the net cash flow for each project.\r<BR>\n" );
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document.write( "you would then need to calculate the cumulative sum of the present value of the net cash flow for each time period.\r<BR>\n" );
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document.write( "the payback period is the time from when the study starts to the time when the cumulative net present value of the project turns positive and stays positive.\r<BR>\n" );
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