Hi,
I am not shire if I'm doing this question right
A land lord currently rents an apartment for $200/month. $50,000 can be invested to convert the apartment into 2 apartments, that will be rented out for $600/month each. Operating costs will increase by $55/month in total. Calculate the payback period.
so the incremental benefit would be (2*600)-200=1 000 the incremental cost is $55 so
1000-55=945 per month net benefit
945(x)=50 000
x=52.91 months
thanks
I am not shire if I'm doing this question right
A land lord currently rents an apartment for $200/month. $50,000 can be invested to convert the apartment into 2 apartments, that will be rented out for $600/month each. Operating costs will increase by $55/month in total. Calculate the payback period.
so the incremental benefit would be (2*600)-200=1 000 the incremental cost is $55 so
1000-55=945 per month net benefit
945(x)=50 000
x=52.91 months
thanks