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Depaul University Operations And Supply Chain Management Assignment Help - The Keego Company


Question - (Ignore income taxes in this problem.) The Keego Company is planning a $200,000 equipment
investment that has an estimated five-year life with no estimated salvage value. The company has
projected the following annual cash flows for the investment:

Year

Cash Inflows
1

$120,000
2

60,000
3

40,000
4

40,000
5

40,000
Total

$300,000


Assuming that the cash inflows occur evenly over the year, the payback period for the investment is
_______ years.

A. 2.50
B. 0.75
C. 1.67
D. 4.91
***Please SHOW HOW to get this

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