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    • Question

      Project A has an initial outflow of ₹2,00,000 and

      annual cash inflows of ₹70,000 for 5 years. What is the Payback Period?
      A 2.86 years Correct Answer Incorrect Answer
      B 3.00 years Correct Answer Incorrect Answer
      C 2.50 years Correct Answer Incorrect Answer
      D 3.50 years Correct Answer Incorrect Answer

      Solution

      Payback Period = Initial Investment / Annual Cash Inflow = ₹2,00,000 / ₹70,000 = 2.857 years ≈ 2.86 years.

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