What is a projects payback period? Discuss the advantages and disadvantages of the payback period method. If

Question:

What is a project’s payback period? Discuss the advantages and disadvantages of the payback period method. If a project has a payback period less than the lifetime of the project, can we know for sure whether the NPV will be positive or negative?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Corporate Finance

ISBN: 9780077173630

3rd Edition

Authors: David Hillier, Stephen A. Ross, Randolph W. Westerfield, Bradford D. Jordan, Jeffrey F. Jaffe

See More Books

Question Posted: Feb 19, 2024 01:01 AM

See More Questions

Let A, B be sets. Define: (a) the Cartesian product (A B) (b) the set of relations R between A and B (c) the identity relation A on the set A [3 marks] Suppose S, T are relations between A and B, and...
Design a Java class that represents a cache with a fixed size. It should support operations like add, retrieve, and remove, and it should evict the least recently used item when it reaches capacity.
Portray in words what transforms you would have to make to your execution to some degree (a) to accomplish this and remark on the benefits and detriments of this thought.You are approached to compose...
How could a company's "green" policies affect their reputation management and community-building strategies, both positively and negatively?
A new inventory management system for ABC Company could be developed at a cost of$260,000.The estimated net operating costs and estimated net benefits over six years of operationwould be: a. What...
(a) Give a balanced equation for the reaction of any of the lanthanoids with aqueous acid. (b) Justify your answer with reduction potentials and with a generalization on the most stable positive...
Aaron loans Victoria $$10,000$ with interest compounded at a rate of 8% annually. How much will Victoria owe Aaron if she repays the entire loan at the end of five years?
For a recent year, Target Corporation reported revenue of $69,865 million. Its gross profit was $22,005 million. What was the amount of Targets cost of merchandise sold?
Compute cost of goods manufactured.
Why would a manager use discounted payback period? Can the discounted payback ever be longer than the conventional payback?
What is meant by a projects NPV, and what is the decision rule? List the main strengths of the net present value method. What do you think are the weaknesses of NPV in practical capital budgeting...
Shawn Burton, a 25-year-old personal loan officer at Second State Bank, understands the importance of starting early when it comes to saving for retirement. She has designated $3,000 per year for her...
Provide one application of your choice, and argue that we would be better o, with a multithread architecture other than a multiprocess architecture when we design the application.?
How do emergent properties such as resilience and stability manifest within ecological systems, and what are the underlying mechanisms that govern their dynamics in the face of environmental...
if you have a single-core CPU computer and the operating system supports multiprocessing. What information/resource do you need to save before performing a context switch to a different running...
What are the molecular mechanisms underlying cellular respiration, and how do variations in metabolic pathways contribute to energy production and homeostasis across different cell types and...
What are the ecological implications of respiratory metabolism in organisms ranging from microbes to mammals, and how do interspecies interactions and ecosystem dynamics influence the exchange of...
Locating Diversity Training Consultants Management thought it was doing the right thing in diversifying its staff. But now signs of friction are appearing. Staff meetings are longer, and conflicts...
General Electric Capital, a division of General Electric, uses long-term debt extensively. In a recent year, GE Capital issued $11 billion in long-term debt to investors, then within days filed legal...
Stock Values the JacksonTimberlake Wardrobe Co. just paid a dividend of $1.60 per share on its stock. The dividends are expected to grow at a constant rate of 6 percent per year indefinitely. If...
Stock Values the next dividend payment by Top Knot, Inc., will be $2.50 per share. The dividends are anticipated to maintain a 5percent growth rate forever. If the stuck currently sells for $48.00...
Stock Values For the company in the previous problem, what is the dividend yield? What is the expected capital gains yield?
Consider the following two lines. A line whose equation is 5x - 6y= 4. = A line perpendicular to the first line. Determine the slope, m, of the line whose equation is 5x - 6y = 4. m1 56 State the...
Find the slope m and y-intercept b. (If an answer is undefined, enter UNDEFINED. If an answer does not exist, enter DNE.) x = -7 m = b = XX Graph the equation. No Solution Help -10 8 7 6 5 4 3 -2-1...
Three insurance companies, A, B, and C, agree to jointly insure a cargo ship for $36,800,000. They allocate the premiums received in the ratio 8:5: 10 respectively. How will the annual premium of...

What is a projects payback period? Discuss the advantages and disadvantages of the payback period method. If

Question:

Step by Step Answer:

The payback period is a financial metric used to evaluate the time it takes for a project to recoup the initial investment It represents the length of ...View the full answer

Corporate Finance

Students also viewed these Business questions