The Payback Period Is Deficient as a Decision Criterion for Capital

question 44

Multiple Choice

The payback period is deficient as a decision criterion for capital projects because it: I $\quad$ Disregards relative profitability
II $\quad$ Ignores income beyond the payback period
III $\quad$ Does not take into account the time value of money

• A) I, II, and III
• B) I only
• C) II only
• D) III only

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Definitions:

Foramen Magnum

A large opening in the base of the skull through which the spinal cord enters and connects to the brain, indicative of bipedal or quadrupedal locomotion in vertebrates.

Femur

The longest and strongest bone in the human body, extending from the hip to the knee.

Levallois Tools

A technology of stone tool production characterized by the striking of flakes from a prepared core, used by prehistoric humans.

Homo Heidelbergensis

An extinct species of the genus Homo, believed to be an ancestor to both modern humans and Neanderthals.