By Measuring How Quickly the Firm Recovers Its Initial Investment

question 8

True/False

By measuring how quickly the firm recovers its initial investment, the payback period gives some implicit consideration to the timing of cash flows and therefore to the time value of money.

---

Definitions:

Personally Approve

A process or action whereby an individual gives their direct and explicit approval or consent.

Cognitive Dissonance Theory

A theory suggesting that people experience discomfort when holding conflicting cognitions, leading them to change their attitudes, beliefs, or actions.

Role-Playing Theory

A theory in social psychology that suggests individuals take on specific roles in group settings, influenced by the expectations of the social environment.

Attribution Theory

A psychological theory that examines how individuals interpret and understand their own behavior and the behavior of others by attributing causes to actions.