Cavity wall insulation costs £240 but will save you £32 each year. What is the payback time for cavity wall insulation?
Answers
The payback time for cavity wall insulation if the cavity wall insulation costs £240 and saves you £32 each year, is 7.5 years.
Explanation:
The cost of cavity wall insulation i.e., the investment on the project = £ 240
Amount it saves every year = £ 32
We know,
The formula for the payback period/time is given by,
Payback period = [Cost of the project or Investment] / [Annual cash inflow or savings per year]
Substituting the given values in the above formula, we get
Payback period = [£ 240] / [£ 32] = 7.5 years
Thus, the payback time for cavity wall insulation is 7.5 years.
---------------------------------------------------------------------------------------------------
Also View:
A project cost rs. 20,00,000 and yield annually rs. 2,50,000 after depreciation at 10% by using straight line method but before tax at 50%. Calculate payback period.
https://brainly.in/question/13169476
Merits and demerits of appraisal methods /financial management
https://brainly.in/question/2002832