Question

A 5-year housing project costing Php 500, 000 is projected to give the following annual returns:
Year 1 – 75, 000
Year 2 – 150, 000
Year 3 – 225, 000
Year 4 – 300, 000
Year 5 – 350, 000

Answer 1

sorry l can not this answer

Answer 2

Yes

Explanation:

The payback period of any project is the time taken to repay the cost of an investment or to reach the breakeven point.

Longer payback periods are less preferred, whereas shorter payback periods are more appealing.

We use the payback period criteria to decide whether the project would be worth it or not.

At year 3 the amount earned would've been = $75,000+150,000+225,000 = 450,000$

At year 4 the amount earned would've been = $75,000+150,000+225,000+300,000 = 750,000$

The payback period for the 500,000 investment will be 4, that is in 4 years the project is covering up the cost of 500,000 and giving more returns.