Answer:
13.33 years
Explanation:
The time it takes for an investment to repay its initial investment if the payback period. For an investment project with regular cash flows, the formula for calculating the payback period is ;
Payback period =Initial investment/cash flows
In this case: Initial investment is $2,000,000.00
cash flow= extras sales per year plus saving on utilities
= $125,000 + $25,000= $ 150,000
payback period = $ 2,000,000/ $ 150,000
=13.33 years
