The Payback Period Has Several Disadvantages, Which Include

question 21

Multiple Choice

The payback period has several disadvantages, which include:

• A) payback optimizes the most economical solution to a capital budgeting problem.
• B) payback includes cash inflows after the payback period.
• C) payback fails to choose the optimum or most economical solution to a capital budgeting problem.
• D) payback ignores liquidity concerns.

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Definitions:

Electrons

Subatomic particles with a negative charge, orbiting the nucleus of an atom and involved in chemical bonds and electrical current.

Mass Number

The total number of protons and neutrons in the nucleus of an atom, which determines its atomic mass.

Protons

Particles with a positive charge found in the nucleus of an atom, playing a role in the atom's mass and total charge.

Neutrons

Subatomic particles found in the nucleus of an atom, with no electric charge and a mass slightly larger than that of protons.