(Solved):Q: ) Grayson Compan…

Question:

Question

) Grayson Company is considering purchase of equipment that costs $49,000 and is expected to offer annual cash inflows of $13,000.

 

 

 

 

 

 

 

 

 

 

 

 

 

Grayson’s minimum required rate of return is 10%. How many years must the cash flows last for the investment to be acceptable?

 

 

 

 

 

 

 

 

 

 

 

 

 

(Do not round your intermediate calculations. Round to nearest whole year.)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

A) 4

 

 

 

 

 

 

 

 

 

 

 

 

 

B) 5

 

 

 

 

 

 

 

 

 

 

 

 

 

C) 3

 

 

 

 

 

 

 

 

 

 

 

 

 

D) 6

 

 

 

 

 

 

 

 

 

 

 

 

 

Expert Answer:

Step 1

Time

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