Dear All,

I'm new to this forum, and I need your help
Could some help me to calculate the payback period?
No initial investment

 

This seems like an odd choice of forum to join to ask this kind of question: a finance question on an electrical engineering forum?

Since this is Homework Help, and not Homework Done For You, you need to provide your best attempt to work the problem. It doesn't have to be complete or correct, but it needs to exist so that we can see what you are doing right and what you are doing wrong so that we can provide feedback to help you make progress.

In working problems like this you need to understand the concept of the time value of money. You adjust all of the figures so that they are presented in present value (their value today). The 25% rate is basically claiming that the viability of this project is being compared to an alternative use of that first year expense, perhaps investing in a new startup venture, that is expected to produce an annual rate of return of 25%. The "at end of the year" note says that, for computation purposes, each transaction is to be considered as having taken place at the end of the indicated year.

 

This seems like an odd choice of forum to join to ask this kind of question: a finance question on an electrical engineering forum?

Since this is Homework Help, and not Homework Done For You, you need to provide your best attempt to work the problem. It doesn't have to be complete or correct, but it needs to exist so that we can see what you are doing right and what you are doing wrong so that we can provide feedback to help you make progress.

In working problems like this you need to understand the concept of the time value of money. You adjust all of the figures so that they are presented in present value (their value today). The 25% rate is basically claiming that the viability of this project is being compared to an alternative use of that first year expense, perhaps investing in a new startup venture, that is expected to produce an annual rate of return of 25%. The "at end of the year" note says that, for computation purposes, each transaction is to be considered as having taken place at the end of the indicated year.

IIRC, these kind of questions are on an EIT or PE exam. Otherwise, most engineers don't deal with them.

 

Welcome to AAC!

But, you're in the wrong place. We do circuits here, not finances.

 

Though I'm pretty sure we can help you through with this one -- but you need to show some work first.