Which of the Following Statements Is CORRECT

question 94

Multiple Choice

Which of the following statements is CORRECT?

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

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