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William’s pharmaceutical cost of finance Custom Essay

    Since, most projects tend to occur over a period extending more than one year, it is vital to use discounted cash flows rather than normal regular flows. Thus, use of discounted cash flows takes into account the time value of money through discounting ( Marney & Tarbert, 2011). The discounted payback period is 2 years + [-11,154]/ 39, 450 which is 2. 28 years. This project is acceptable as the time to recover $ 100, 000 the initial investment is less than the threshold level of five years. Furthermore, investment