Payback and Internal Rate of Return
A project has perpetual cash flows of C per period, a cost of I, and a required return of R.
What is the relationship between the project’s payback and its IRR? What implications does your answer have for long-lived projects with relatively constant cash flows?
4. Payback and Internal Rate of Return A project has perpetual cash flows of C per period, a cost of I, and a required return of R. What is the relationship between the project’s payback andits…