Payback period method, finance, Other Engineering

Payback period method, finance, Other Engineering

Assignment Help:

Non-discounted cash flow method,

Payback period method
In this method, time value of money is not considered. It takes into account the number of years required to recover the initial investment of a project (Harold Bierman, Seymour Smidt, 2006).
Accept Reject Rule:
Accept the project with lowest payback period.
Reject the project with highest payback period.
Merits:
1. Simple and easy to calculate
2. Less costly to use
3. Less time consuming
De-merits:
1. Time value of money is completely ignored.
2. Does not consider the cash flow generated after payback period.

Related Discussions:- Payback period method, finance

Corporate finance, An investment project provides cash inflows of $730 per ...

An investment project provides cash inflows of $730 per year for eight years. What is the project payback period if the initial cost is $3,500? What if the initial cost is $5,000?

Aircraft maintenance, compression of gas turbine

compression of gas turbine

Calculate percent gain, Assume you invest $150 per month in a stock. Stock ...

Assume you invest $150 per month in a stock. Stock prices are as follows: January $10.50, February $9.75, March $9.50, April $11.00, May $10.75, June $9.75, July $9.00, August $8.5

Logic gate-nor gate, NOR Gate: Figure shows a further example of a 2 in...

NOR Gate: Figure shows a further example of a 2 input digital gate, again consisting of two NPN transistors, TR1 and TR2, in a different configuration. When input A and input

Vertical spread, What are the no-arbitrage lower bound, and the no-arbitrag...

What are the no-arbitrage lower bound, and the no-arbitrage upper bound, of the vertical spread

Engine, #question.what if i poured diesel in petrol engine and petrol in di...

#question.what if i poured diesel in petrol engine and petrol in diesel engine.

Ic Packages, Ic Packages: Like transistors and other types of solid sta...

Ic Packages: Like transistors and other types of solid state components, IC's are mounted in packages, which protect them from moisture, dust and other types of contaminations.

Analysis of the energy intensity, Analysis of the energy intensity and CO 2...

Analysis of the energy intensity and CO 2 emissions of a State a . From DOE/Energy Information Agency Florida profile is given by the following numbers (2009): What is

strength of materials, applications of the subject-strength of material

applications of the subject-strength of materials

LTE, LTE

LTE

Write Your Message!

Name

Email id

Message

Verfication Code

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd