Net initial investment is divided by uniform increasing in future cash flows to calculate payback period. The payback period refers to the amount of time it takes to recover the cost of an investment. Simply put, the payback period is the length of time an investment reaches a breakeven point. The desirability of an investment is directly related to its payback period.
If nominal rate is 26% and inflation rate is 12%, then real rate can be
A concept which explains a received money in present time, is more valuable than money received in future is called time value of money. The time value of money (TVM) is the concept that money available at the present time is worth more than the identical sum in the future due to its potential earning capacity.
If payback period is 4 years and uniform increases in cash flows per year is $2750000, then net initial investment can be