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1. A new project is estimated to cost $52,125, its expected net cash flows are $10,000 per year for 8 years, its WACC is 14 percent. What is the projects Internal Rate of Return (IRR) period?
2. A new project is estimated to cost $52,125, its expected net cash flows are $12,000 per year for 8 years, its WACC is 12 percent. What is the projects Payback period?
The financial planning process
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Payback method analyzes the period of time required to recover the money invested in a project. It is a very simple tool for analyzing the feasibility of any project.
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