Determining the three-year payback period to project

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Susan is considering adding toys to her gift shop. She estimates that the cost of inventory will be $6,500. The remodeling expenses and shelving costs are estimated at $2,800. Toy sales are expected to produce net cash inflows of $3,300, $3,300, $4,300, and $4,300 over the next four years, respectively. Should Susan add toys to her store if she assigns a three-year payback period to this project? Why or why not?

Reference no: EM132465477

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