CIPS Exam L6M5 Topic 2 Question 15 Discussion

Actual exam question for CIPS's L6M5 exam

Question #: 15
Topic #: 2

[All L6M5 Questions]

Green Thumb Ltd, a landscaping company, is considering investing in a new lawn mower costing 10,000. The CFO estimates that the new machinery would increase annual income by approximately 2,000. What is the payback period of the investment?

A20%

B10 years

C5 years

D8,000

Show Suggested Answer

Suggested Answer: C

Payback period = Investment Cost Annual Cash Flow = 10,000 2,000 = 5 years.

by Torie at Aug 18, 2025, 10:30 AM

Limited Time Offer

25%

Off

Get Premium L6M5 Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

Submit Cancel

Tashia

12 days ago

I agree with Jesusa. The new lawn mower will bring in 2,000 extra income each year, so it will take 5 years to recoup the 10,000 investment.

upvoted 0 times

...

Jesusa

16 days ago

I think the payback period is 5 years.

upvoted 0 times

...