When Calculating a Project's Payback Period, Cash Flows Are Discounted

question 98

Multiple Choice

When calculating a Project's payback period, cash flows are discounted at:

• A)the opportunity cost of capital.
• B)the internal rate of return.
• C)the risk-free rate of return.
• D)a discount rate of zero.

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Definitions:

Lessee

A person or entity who leases or rents property from a lessor, obtaining the rights to use and occupy the property according to the terms of the lease agreement.

Title Does Not Pass

A legal principle indicating that the ownership of a property or asset has not been transferred from the seller to the buyer, often due to certain conditions not being met.

CISG

Stands for the United Nations Convention on Contracts for the International Sale of Goods, which provides a uniform framework for international commerce.

Risk Of Loss

The potential that an investment's value may decrease, or that the property may be destroyed, damaged, or lost, impacting the holder's financial position.