A Weakness of the Payback Method of Project Evaluation Is

question 42

Multiple Choice

A weakness of the payback method of project evaluation is that it:

• A)fails to take account of the magnitude and timing of the cash flows.
• B)rejects all projects with a payback period greater than the maximum payback period.
• C)rejects all projects with a payback period less than the maximum payback period.
• D)fails to take account of the timing of cash flows,but does take into account the magnitude of cash flows.

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Definitions:

Feasibility

The practicality or possibility of a proposed plan or project being successfully implemented.

Market Analysis

A comprehensive evaluation of the market's size, trends, and growth prospects, often used to inform business strategies.

Topical Organization

A method of structuring information by dividing it into topics or categories for clarity and ease of understanding.

Informational Reports

Documents that provide facts and data without analysis or recommendations, intended to inform the reader about a specific topic.