An investor is considering two investment projects. Project A requires an initial payment of £13,000. In return, the investor will receive a payment of £18,600 after one year. Project B requires an initial payment of £10,900. In return, the investor will receive a payment of £1,300 at the end of every month for one year. Calculate the cross-over rate of the projects % Enter a percentage correct to 1 decimal place. What is the payback period of each project? Project A: months Project B: months
An investor is considering two investment projects. Project A requires an initial payment of £13,000. In return, the investor will receive a payment of £18,600 after one year. Project B requires an initial payment of £10,900. In return, the investor will receive a payment of £1,300 at the end of every month for one year. Calculate the cross-over rate of the projects % Enter a percentage correct to 1 decimal place. What is the payback period of each project? Project A: months Project B: months
Chapter5: The Time Value Of Money
Section: Chapter Questions
Problem 16P
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Question
An investor is considering two investment projects.
Project A requires an initial payment of £13,000. In return, the investor will receive a payment of £18,600 after one year.
Project B requires an initial payment of £10,900. In return, the investor will receive a payment of £1,300 at the end of every month for one year.
Calculate the cross-over rate of the projects
%
Enter a percentage correct to 1 decimal place.
What is the payback period of each project?
Project A: months
Project B: months
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