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Glitter Kitten Ltd CEO applies the Payback Analysis for expansion.
Investment: 50m
Annual returns: 10m
Q: What is the payback period?
Answer Options:
Suggested Answer: B
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Payback period formula:
Investment (50m) Annual inflow (10m) = 5 years. [P.1.4]
38 comments · newest first
FL
Floyd
10 months ago
50 years? No way, that can't be right!
MO
Mozell
11 months ago
Wait, is it really 5 years? Seems off to me.
EU
Eura
11 months ago
Payback period is 5 years. Simple math!
CH
Christoper
11 months ago
Yup, 5 years sounds right!
KI
Kiera
11 months ago
Totally agree, 50m investment with 10m returns.
SA
Sarah
11 months ago
I keep second-guessing myself, but I think the payback period is more about how long it takes to break even. So, if the investment is 50 million and the returns are 10 million annually, I guess it must be 5 years?
DO
Dortha
12 months ago
I practiced a similar question last week, and I think the payback period was just a straightforward calculation. I hope I remember it correctly; I feel like it's definitely not 1 year or 50 years.
AN
An
12 months ago
I'm not entirely sure, but I remember something about the payback period being the time it takes to recover the initial investment. If that's the case, then 5 years seems like a reasonable answer.
KA
Kathrine
1 year ago
I think the payback period is calculated by dividing the investment by the annual returns, so it should be 50 million divided by 10 million. That sounds like 5 years, right?
DO
Dominic
1 year ago
Okay, I got this. The payback period is the number of years it takes to recoup the initial investment of 50m, given the annual returns of 10m. So the payback period is 50m / 10m = 5 years. Easy peasy!
ZO
Zoila
1 year ago
Wait, I'm a bit confused. Is the payback period the number of years it takes to fully recover the initial investment? Or is it something else? I need to review the payback analysis formula to be sure.
ED
Edgar
1 year ago
This looks straightforward. The payback period is the time it takes to recover the initial investment, so it should be 50m / 10m = 5 years. I'm confident that's the right answer.
GL
Glory
1 year ago
Hmm, I'm not sure. Isn't the payback period the time it takes to recoup the initial investment? I think I need to do some more calculations to figure this out.
LO
Louisa
1 year ago
Okay, let's think this through step-by-step. The investment is 50m and the annual returns are 10m. To find the payback period, I just need to divide the investment by the annual returns, right?
EL
Elke
2 years ago
I think it's 1 year because the annual returns cover the investment in the first year.
TE
Terrilyn
2 years ago
I agree with Shalon, the payback period should be 10 years.
GA
Gail
2 years ago
Meow, meow, payback in 1 year? I call catnip on that one!
LA
Laurel
1 year ago
User 2
LA
Laura
2 years ago
User 1
PA
Pamella
2 years ago
1 year? That's faster than a cheetah on Red Bull. I'm not buying it.
TI
Tijuana
1 year ago
Well, 5 years seems more realistic for such a big investment.
ZE
Zena
1 year ago
B) 5 years
KR
Kristian
1 year ago
1 year? That's faster than a cheetah on Red Bull. I'm not buying it.
AS
Ashleigh
2 years ago
A) 1 year
CA
Candra
2 years ago
50 years? Glitter Kitten CEO must be living in the future if they think that's a reasonable payback period.
SH
Shalon
2 years ago
I believe it's 10 years because the investment is 50m and the annual returns are 10m.
LA
Lawanda
2 years ago
Really? 10 years? I thought this was a simple calculation, not a Netflix series.
EL
Elvera
2 years ago
User 3: Maybe there are other factors at play that we're not considering.
MA
Marlon
2 years ago
User 2: Yeah, I agree. It's surprising that it would take that long.
DE
Detra
2 years ago
User 1: That does seem like a long payback period.
MA
Malinda
2 years ago
Payback period? Piece of cake! 5 years, easy peasy.
CO
Cordie
2 years ago
C) 10 years
TH
Thaddeus
2 years ago
B) 5 years
TO
Toshia
2 years ago
A) 1 year
BE
Bernadine
2 years ago
C) 10 years
CE
Cecilia
2 years ago
B) 5 years
AP
Apolonia
2 years ago
A) 1 year
DO
Dona
2 years ago
I think the payback period is 5 years.