Which of the Following Statements Is CORRECT

question 52

Multiple Choice

Which of the following statements is CORRECT?

• A)The shorter a project's payback period, the less desirable the project is normally considered to be by this criterion.
• B)One drawback of the regular payback is that this method does not take account of cash flows beyond the payback period.
• C)If a project's payback is positive, then the project should be accepted because it must have a positive NPV.
• D)The regular payback ignores cash flows beyond the payback period, but the discounted payback method overcomes this problem.
• E)One drawback of the discounted payback is that this method does not consider the time value of money, while the regular payback overcomes this drawback.

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Definitions:

Statute of Frauds

A legal doctrine requiring certain contracts to be in writing to be legally enforceable.

Evidenced

Something that is made apparent or is provided as proof in support of an assertion, fact, or claim.

Collateral Contracts

Secondary contracts that supplement a primary contract, often providing for additional rights or obligations that enhance the original agreement.

Month-to-Month Lease

A rental agreement that renews each month automatically until either the landlord or tenant decides to terminate it.