Brotherly Clinic is evaluating a project that costs $62,500 and has expected net cash inflows of $12,000 per
year for 8 years. The first inflow occurs one year after the cost outflow. What is the projects payback in years?
You are the manager of a radiology department in a rural 80-bed hospital. The department’s MRI machine is
old, outdated and in frequent need of repair. Your boss has asked you to explore the purchase of a new MRI
machine. You are expected to present your findings to the hospital’s capital budget team.
For this assignment, please indicate how you would go about conducting an analysis to obtain a new MRI
machine.
Sample Solution
