Which of the Following Is a Technique for Evaluating Capital

question 51

Multiple Choice

Which of the following is a technique for evaluating capital projects that tells how long it will take a firm to earn back the money invested in a project plus interest at market rates?

• A) Payback
• B) Discounted payback
• C) Net present value
• D) Profitability index

---

Definitions:

Broad Portfolio

An investment strategy involving a wide range of assets to diversify risk.

Long-Term Investors

Individuals or entities that invest in assets with the expectation of holding them for an extended period.

Steady Rate

A constant pace or level of progress, maintaining uniformity over a specified time without abrupt changes or fluctuations.

Short-Term Investors

Individuals or entities that purchase assets with the intention of holding them for a brief period, typically less than a year, to profit from short-term price movements.