If a Project Has a Payback Period of 5 Years

question 23

Multiple Choice

If a project has a payback period of 5 years and a cost of capital of 10%,then the discounted payback will:

• A) exceed 5 years.
• B) be less than 5 years.
• C) decrease if the cost of capital increases.
• D) decrease if the payback period increases due to revised cash flows.

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Definitions:

Jury's Verdict

The decision reached by a jury at the end of a trial, determining the guilt or innocence of the defendant or the outcome of a civil case.

Binding

Legally enforceable and obligatory; often referring to agreements, decisions, or rulings.

Parties

Individuals or entities involved in a legal agreement or dispute.

Pleadings

Written documents submitted by parties in a legal action, outlining the claims and defenses to be addressed by the court.