Answer:
4.5 years
No
Explanation:
The Payback period calculates the amount of time it takes to recover the amounts invested in a project from its cumulative cash flows.
Total investments = $-59,000 - $9,000 = $-68,000
In the first year: $-68,000 + $5,000 = $-63,000 is recovered
In the 2nd year: $-63,000 + $ 10,000 = $-53,000 is recovered
In the 3rd year: $-53,000 + $ 20,000 = $-33,000 is recovered
In the 4th year $-33,000 + 21,000 = $-12,000
In the 5th year $-12000 + $24,000 = $12,000
The amount invested is recovered between the 4th and 5th year
4 years + $-12000 / $24,000 = 4.5years
The Payback period would not be affected if the cash inflow in the last year were several times as large because the cash flow would have been recovered by the 5tj year.
I hope my answer helps you
