The payback period is the period A. a project takes to pay back the loan taken to purchase the capital assets B. equal to the useful life of the machines C. a project takes to recover its initial cash outflow D. over which the project will be getting operating cash inflows

The payback period is the period 

A. a project takes to pay back the loan taken to purchase the capital assets 

B. equal to the useful life of the machines 

C. a project takes to recover its initial cash outflow 

D. over which the project will be getting operating cash inflows
by

1 Answer

Answer :

C. a project takes to recover its initial cash outflow
by

Related questions

A project has the following cash inflows Rs.34,444; Rs.39,877; Rs.25,000; and Rs.52,800 for years 1 through 4, respectively. The initial cash outflow is Rs.104,000. Which of the following four statements is correct concerning the project internal rate of return (IRR)? A. The IRR is less than 10%. B. The IRR is greater than or equal to 10%, but less than 14%. C. The IRR is greater than or equal to 14%, but less than 18%. D. The IRR is greater than or equal to 18%.

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Last Answer : C. The IRR is greater than or equal to 14%, but less than 18%.

The cash inflows and (outflows) associated with a project are as follows: At start (120000) , Year1-40000, Year2-50000, Year3-60000, Residual Value(at the end of 3rd year)-20000. The payback period for this project would be: A 2 years and 3 months. B 2 years and 6 months. C 3 years. D 2 years.

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Last Answer : B 2 years and 6 months.

Which of the following statements is incorrect regarding a normal project? A. If the NPV of a project is greater than 0, then its PI will exceed 1. B. If the IRR of a project is 8%, its NPV, using a discount rate, k, greater than 8%, will be less than 0.C. If the PI of a project equals 0, then the project's initial cash outflow equals the PV of its cash flows. D. If the IRR of a project is greater than the discount rate, k, then its PI will be greater than 1.

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Which of the following is true? A. Discounted cash flow analysis is the least precise of the cash flow techniques, because it does not consider the time value of money. B. NPV is the least precise of the cash flow analysis techniques, because it assumes reinvestment at the discount rate. C. Payback period is the least precise of the cash flow analysis techniques, because it does not consider the time value of money. D. IRR is the least precise of the cash flow analysis techniques, because it assumes reinvestment at the cost of capital.

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When operating under a single-period capital-rationing constraint, you may first want to try selecting projects by descending order of their in order to give yourself the best chance to select the mix of projects that adds most to firm value. A. profitability index (PI) B. net present value (NPV) C. internal rate of return (IRR) D. payback period (PBP)

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