A Disadvantage of the Cash Payback Technique Is That It

question 153

Multiple Choice

A disadvantage of the cash payback technique is that it

• A) ignores obsolescence factors.
• B) ignores the cost of an investment.
• C) is complicated to use.
• D) ignores the time value of money.

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Definitions:

Corporate Tax Rate

The percentage of a corporation's profits that is handed over to the government as tax.

Depreciation Expense

The allocation of the cost of a tangible asset over its useful life.

Bankruptcy

A legal process for individuals or businesses unable to meet their outstanding debts, allowing them to negotiate for partial or complete relief.