Which of the Following Statements About the Payback Period Method

question 65

Multiple Choice

Which of the following statements about the payback period method is true?

• A)All other things being equal, a company would prefer a project with a longer payback period.
• B)The payback period method ignores the time value of money.
• C)The payback period method is more sophisticated and yields better decisions than the internal rate of return method.
• D)The payback period method takes into account the total stream of cash flows, which are difficult to predict.

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