Which of the Following Statements Best Describes Payback

question 23

Multiple Choice

Which of the following statements best describes payback?

• A) The regular payback method recognizes all cash flows over a project's life.
• B) The discounted payback method recognizes all cash flows over a project's life, and it also adjusts these cash flows to account for the time value of money.
• C) The regular payback method was widely used years ago, but virtually no companies even calculate the payback today.
• D) The regular payback is useful as an indicator of a project's liquidity because it gives managers an idea of how long it will take to recover the funds invested in a project.

---

Definitions:

Top-Down Processing

A cognitive process that uses context or general knowledge to understand and interpret information.

Touch

One of the five senses, involving the perception of physical pressure or deformation against the skin, crucial for human emotional connection and environmental interaction.

Pain

A distressing experience involving both sensation and emotion, stemming from existing or prospective damage to tissue, or expressed through descriptions of such damage.

Hearing

The sense and physiological process of perceiving sounds through the ears.