Assessing investments: Extra exercises
Extra exercises
A corporation invests #14# million euros in a project on 1-1-2013. Subsequently, the net cash flows for #21# years, received always at the end of each year, are structured as follows: for the first #16# years #1.2# million euros per year and then for the next #5# years #0.8# million euros per year.
The discount rate is #7#% per year. The residual value of the project is #1.6# million euros. The net cash flow at the end of the final year includes this residual value.
Calculate the accounting payback period (APP). Round your answer to a whole number.
| #APP=# |
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