Which of the Following Methods Ignores the Time Value of Money

question 18

Multiple Choice

Which of the following methods ignores the time value of money?

• A)Payback
• B)Internal rate of return
• C)Net present value
• D)Return on assets

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Definitions:

Promissory Estoppel

A legal principle preventing a party from backing out of a promise made, when the other party has relied on that promise to their detriment.

Consideration

The value (usually money, service, or goods) exchanged between parties in a contract that compels them to fulfill their mutual obligations.

Preexisting Duty

An obligation that a party is already bound to by law or by some other agreement. The party may not use this as consideration in a new contract.

Promissory Estoppel

A judicial principle that stops one from retracting a pledge given to another if the latter has justifiably depended on the promise to their disadvantage.