The Traditional Payback Period Technique That Is Used in Capital

question 17

Multiple Choice

The traditional payback period technique that is used in capital budgeting analyses:

• A)is the simplest and oldest formal method used to evaluate capital budgeting projects.
• B)directly accounts for the time value of money.
• C)considers the discounted value of cash flows beyond the project's payback period.
• D)always results in maximizing the value of the firm when used to evaluate mutually exclusive projects.
• E)incorporates risk into the discount rate that is used to compute the payback period.