The expected amount of time to recover the initial amount of an investment is called the:...
The expected amount of time to recover the initial amount of an investment is called the:
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Amortization period.
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Payback period.
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Interest period.
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Discounted cash flow period.
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Budgeting period.
Homework Answers
Correct answer------ Payback period.
.
Payback period is the time in years that takes an investment to return the initial invested cash on that investment.
Payback period is calculated as below.
| Payback period | ||||
| Initial Investment | / | Annual cash inflow | = | Payback period |
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The expected amount of time to recover the initial amount of an
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Payback period essentially provides the number of years it would take for a project to recover...
Payback period essentially provides the number of years it would take for a project to recover the initial investment from its operating cash flows. As the model was criticized, the model evolved incorporating time value of money to create the discounted payback method. The models still reflected faulty ranking criteria but they provided important information about liquidity and risk. The _______ the payback, other things constant, the greater the project’s liquidity. Suppose ABC Telecom Inc.’s CFO is evaluating a project...
Payback period essentially provides the number of years it would take for a project to recover...
Payback period essentially provides the number of years it would take for a project to recover the initial investment from its operating cash flows. As the model was criticized, the model evolved incorporating time value of money to create the discounted payback method. The models still reflected faulty ranking criteria but they provided important information about liquidity and risk. The the payback, other things constant, the greater the project's liquidity. Suppose Omni Consumer Products's CFO is evaluating a project with...
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The length of time required to recover the initial investment in a capital asset is known...
The length of time required to recover the initial investment in a capital asset is known as the: a. the rate of return b. payback method c. internal rate of return d. unadjusted rate of return
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The payback method helps firms establish and identify a maximum acceptable payback period that helps in...
The payback method helps firms establish and identify a maximum acceptable payback period that helps in their capital budgeting decisions. Consider the case of Green Caterpillar Garden Supplies Inc.: Green Caterpillar Garden Supplies Inc. is a small firm, and several of its managers are worried about how soon the firm will be able to recover its initial investment from Project Beta's expected future cash flows. To answer this question, Green Caterpillar's CFO has asked that you compute the project's payback...
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Payback period essentially provides the number of years it would take for a project to recover the initial investment from its operating cash flows. As the model was criticized, the model evolved incorporating time value of money to create the discounted payback method. The models still reflected faulty ranking criteria but they provided important information about liquidity and risk. The the payback, other things constant, the greater the project's liquidity. Suppose Omni Consumer Products's CFO is evaluating a project with...
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it CENGAGE | MINDTAP Assignment 11 - The Basics of Capital Budgeting 7. The payback period Aa Aa E The payback method helps firms establish and identify a maximum acceptable payback period that helps in their capital budgeting decisions. Consider the case of Green Caterpillar Garden Supplies Inc.: Green Caterpillar Garden Supplies Inc. is a small firm, and several of its managers are worried about how soon the firm will be able to recover its initial investment from Project Beta's...
The payback method helps firms establish and identify a maximum acceptable payback period that helps in their capital budgeting decisions. Consider the case of Green Caterpillar Garden Supplies Inc.: Green Caterpillar Garden Supplies Inc. is a small firm, and several of its managers are worried about how soon the firm will be able to recover its initial investment from Project Beta's expected future cash flows. To answer this question, Green Caterpillar's CFO has asked that you compute the project's payback...
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13. The payback period Aa Aa The payback method helps firms establish and identify a maximum acceptable payback period that helps in their capital budgeting decisions Consider the case of Cold Goose Metal Works Inc.: Cold Goose Metal Works Inc. is a small firm, and several of its managers are worried about how soon the firm will be able to recover its initial investment from Project Beta's expected future cash flows. To answer this question, Cold Goose's CFO has asked...
Assignment 11 - The Basics of Capital Budgeting The payback method helps firms establish and identify a maximum acceptable payback period that helps in their capital budgeting decisions. Consider the case of Blue Hamster Manufacturing Inc.: Blue Hamster Manufacturing Inc. is a small firm, and several of its managers are worried about how soon the firm will be able to recover its initial investment from Project Delta's expected future cash flows. To answer this question, Blue Hamster's CFO has asked...
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