Evaluate the Following Projects Using the Payback Method Assuming a Rule

question 127

Multiple Choice

Evaluate the following projects using the payback method assuming a rule of 3 years for payback.

• A) Project A can be accepted because the payback period is 2.5 years but Project B cannot be accepted because its payback period is longer than 3 years.
• B) Project B should be accepted because even thought the payback period is 2.5 years for project A and 3.001 project B, there is a $1,000,000 payoff in the 4th year in Project B.
• C) Project B should be accepted because you get more money paid back in the long run.
• D) Both projects can be accepted because the payback is less than 3 years.

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Definitions:

Homeostasis

The tendency of the body to maintain a steady state.

Eustress

Positive stress that motivates and enhances one's functioning or performance.

External Locus of Control

The belief that one's life outcomes are largely determined by external forces beyond one's personal control or influence.

High Self-efficacy Expectations

The belief in one's own ability to succeed in specific situations or accomplish a task, which can play a significant role in how goals, tasks, and challenges are approached.