A Significant Advantage of the Payback Period Is That It

question 25

Multiple Choice

A significant advantage of the payback period is that it

• A) places emphasis on time value of money.
• B) allows for the proper ranking of projects.
• C) tends to reduce firm risk because it favors projects that generate early, less uncertain returns.
• D) gives proper weighting to all cash flows.

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Definitions:

Export Units

Export Units refers to the quantity of goods or services sent out of a country to foreign markets.

Import Units

A measure concerning the quantity of goods or services that a country brings in from other countries for domestic consumption or use.

Trade

The exchange of goods, services, or both between two or more parties, either within an economy or between economies.

Comparative Advantage

The ability of an individual, firm, or country to produce a particular good or service at a lower opportunity cost than others.