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

Phase detector, Phase detector Phase detector (PD) consists of a multip...

Phase detector Phase detector (PD) consists of a multiplier and a low pass filter. The output of the PD has a magnitude proportional to V s cos 2 φ where φ is the phase shif

Fabric types - woven rovings , The terms roving and yarn are widely used. A...

The terms roving and yarn are widely used. A roving is a collection of untwisted strands wound together. A yarn is a generic term for a continuous strand of textile fibres, filamen

Capital structure of X Ltd. as on 31st Dec 2003, The following is the capit...

The following is the capital structure of X Ltd. as on 31st Dec 2003 Rs in m

Aircraft radio installation licence and approval, AIRCRAFT RADIO INSTALLATI...

AIRCRAFT RADIO INSTALLATION (STATION) LICENCE AND APPROVAL 1. A radio installation licence is issued by the Department of Trade and Industry Radio Communications Agency , fo

Light wave and matters, Expertsmind.com brings you unique solution in phy...

Expertsmind.com brings you unique solution in physics - What is light? - - Light is an electromagnetic wave that also comes in "photons"

New building completion - fire safety management, Ne w building completion...

Ne w building completion: New buildings have to be constructed to meet certain fire safety standards. It is not acceptable for buildings to be built that do not attain a min

Variable interest rate, What is Variable Interest Rate? Interest rates whic...

What is Variable Interest Rate? Interest rates which is offered by banks or financial institutions on loans or deposits which are liable to change according to circumstances. For e

Series of cash flows in economical engineering, Series of Cash Flows M...

Series of Cash Flows Most engineering economic analysis involve more than a single return occurring after the investment is made. In such cases, the present worth or the futur

PLC, True or False, In a PLC system, there is a physical connection between...

True or False, In a PLC system, there is a physical connection between field input devices and output devices.

Binary cycle, Consider the binary cycle using the sodium and steam/water in...

Consider the binary cycle using the sodium and steam/water in the sketch below and operating at conditions in Table 1. Draw T S Diagram and find the thermal cycle efficiency

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