Problem: AAAcme Company is preparing an investment plan and has received three proposals with investments and returns as shown below. Which one(s) should be approved using a discounted payback period of 3 years (meaning by the end of year 3) . AAAcme uses a MARR of 12%
| |
Cash Flow |
| Year |
X |
Y |
Z |
| Initial |
($100,000) |
($70,000) |
($135,000) |
| 1 |
$20,000 |
$10,000 |
$25,000 |
| 2 |
$40,000 |
$50,000 |
$30,000 |
| 3 |
$80,000 |
$20,000 |
$60,000 |
| 4 |
$50,000 |
$10,000 |
$100,000 |
| 5 |
$30,000 |
$10,000 |
$150,000 |