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MCS,PHD
Argosy University/ Phoniex University/
Nov-2005 - Oct-2011
Professor
Phoniex University
Oct-2001 - Nov-2016
Primera Banco is evaluating two capital investment proposals for a drive-up ATM kiosk, each requiring an investment of $360,000 and each with an 8-year life and expected total net cash flows of $480,000. Location 1 is expected to provide equal annual net cash flows of $60,000, and Location 2 is expected to have the following unequal annual net cash flows:
Year 1 ………………………. $120,000
Year 2 …………………………. 90,000
Year 3 …………………………. 75,000
Year 4 …………………………. 75,000
Year 5 …………………………. 30,000
Year 6 …………………………. 30,000
Year 7 ………….……………… 30,000
Year 8 …………………………. 30,000
Determine the cash payback period for both location proposals.
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