Which of the best describes the discount rate

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Problem 1: Which of the following best describes the discount rate that when applied to the future cash flows makes them equal to the initial cash expenditures?

a) Payback Period
b) Internal Rate of Return
c) Net Present Value
d) Accounting Rate of Return

Problem 2: What is an advantage of the Pay Back Period method?

a) It considers all cash flows.
b) It considers the wealth of shareholders of the business.
c) It considers the hurdle rate.
d) It is very easy to use and simple to explain.

Reference no: EM132736934

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